Preamble

The House met at half-past Two o'clock

PRAYERS

[Mr. SPEAKER in the Chair]

Oral Answers to Questions — NATIONAL FINANCE

Post Office Savings

Dr. King: asked the Chancellor of the Exchequer by how much Post Office savings have increased since he introduced the tax exemption on the first £300 of savings.

The Economic Secretary to the Treasury (Mr. Anthony Barber): Between July, 1956, when the Income Tax concession first applied to the first £15 of interest, and the end of 1959 the amount remaining invested in the Post Office Savings Bank fell by £32 million.

Dr. King: Is the Minister aware that, in spite of these figures, the excellent reform that he introduced has encouraged small investors to invest their money in Britain and that this is a very useful thing indeed?

Mr. Barber: I entirely agree with what the hon. Gentleman has said. It is a fact that after the concession was introduced there was a distinct reduction in the rate of outflow of funds from the Bank, and, indeed, if one considers the year 1959, the amount remaining invested in the Post Office Savings Bank increased by £32 million.

Income Tax (Loans to Local Authorities)

Dr. King: asked the Chancellor of the Exchequer if he will consider introducing legislation to provide Income Tax exemption on the first £300 of loans by individuals to local authorities.

Mr. Barber: No, Sir.

Dr. King: Since it is good that, again, small investors should invest their

money with local authorities, will the Economic Secretary ask his right hon. Friend the Chancellor to consider whether he cannot apply the argument on Post Office savings to local authority savings on this scale?

Mr. Barber: No, Sir. The two cases are quite distinct. The object of the concession, so far as the Post Office Savings Bank and trustee savings banks are concerned, was to encourage national savings, which are small savings lent to the Government.

Income Tax (Post-War Credits)

Mr. McKay: asked the Chancellor of the Exchequer whether he is aware that, notwithstanding the provisions of Section 47 of the Income Tax Act, 1952, which precludes new assessments after a period of six years where no effort at concealment or fraud has been attempted, deductions have been made in the amounts paid during 1959 in settlement of post-war credits assessed and notified to the payees in 1945–46; by what authority this has been done; and if he will make a statement.

The Financial Secretary to the Treasury (Sir Edward Boyle): I have written to the hon. Member about this case.

Mr. McKay: While I admit that the letter is a very long one explaining the position very fully, may I say at once that, so far as the question of the legal position of post-war credits is concerned, I am quite sure that that is in order?

Mr. Mitchison: On a point of order. I did not hear the Minister's Answer to Question No. 3.

Sir E. Boyle: I said that I had written to the hon. Member about this case.

Mr. Mitchison: Further to that point of order. There is no case in Question No. 3.

Sir E. Boyle: I do not think that the House would bless me if I attempted to read the letter, which, as the hon. Member said, was a fairly long one, full of information, but I am glad that the hon. Member feels that it covers the points.
I apologise, Mr. Speaker. The Answer to Question No. 3 is: "I assume


that this Question relates to a case about which I have written to the hon. Member. As I explained, no assessment was made in that case more than six years after the years in question."

Mr. McKay: asked the Chancellor of the Exchequer if he is aware that a constituent of the hon. Member for Wallsend who had his Income Tax assessment completed for the year 1945–46 was informed, in December, 1959, that in 1945–46 there was an underpayment of £34 14s. 6d. Income Tax, and that his claim for post-war credits had been reduced by £31 10s.; and since this notification was given 13 years after the assessment and no concealment or fraud has been indicated, whether he will reconsider this decision and pay the amount deducted from the post-war credits.

Sir E. Boyle: I have written to the hon. Member about this case.

Mr. McKay: I just want to say that I am quite satisfied about the letter. Nevertheless, I think that in view of what was in it and of how the matter has been investigated it ought to be publicised. [HON. MEMBERS: "What was in it?"] I want to put it to the Minister that the letter itself is not as fully satisfactory as it might be, but there is one thing which it does admit, which is that mistakes have been made by the Revenue Department on several occasions, that the Department is paying back £5 10s. to my constituent because of those mistakes and that the Department apologises and admits them. I hope that this kind of thing will not happen again. [HON. MEMBERS: "Hear, hear."] I just want to say this to the Minister—

Mr. Speaker: Order. I do not want unduly to trouble the hon. Member, but I must require him to ask questions and not to make statements.

Mr. McKay: Is the Financial Secretary satisfied that during this period that this work has been done those concerned have been as satisfied as they might have been? I have any number of complaints that people have not received notification of these deductions from post-war credits to meet underpayment of tax and, years later, have found that they have no post-war credits left?

Sir E. Boyle: I apologise unreservedly to you Mr. Speaker, and to the House for the mistake I made just new. Very briefly, the position, as the hon. Gentleman knows, is this. About £29 of tax was unpaid for 1945–46, so, to that extent, the post-war credits question never arose. A small amount of the underpayment of the previous year was set against the sum and, as the hon. Gentleman says, a repayment of the balance of £5 10s. will soon be made. I am sure that this is the right way to deal with this matter, and that the hon. Gentleman can feel satisfied.

Income Tax (Schedule A)

Mr. W. Clark: asked the Chancellor of the Exchequer to what extent it would facilitate administration if Schedule A tax were abolished on all rented property and the net income therefrom assessed under Schedule D, instead of as at present taxing one source of income under two Schedules of the Income Tax Acts.

Sir E. Boyle: There is not enough information for an estimate, but the cost of administration would almost certainly be greater than at present.

Mr. Clark: Would my hon. Friend agree that it would be generally welcomed by all professions in the property business if rented property were to be assessed under one Schedule rather than under two, as at present—and, possibly, without any loss of revenue?

Sir E. Boyle: My hon. Friend's Question refers specifically to administration, and the point is that the administrative costs would be expected to rise under his proposal, because the particulars of maintenance expenditure would have to be examined in every case.

Mr. Wade: Would not the hon. Gentleman agree that Schedule A tax is open to objections on grounds other than those of administrative complexity? For example, a landlord may not spend anything at all on repairs and maintenance but still get the statutory allowance. On the other hand, the owner-occupier may spend a great deal more than the statutory allowance but, because he does not know the law, may not reclaim what he is entitled to. Would not the simplest thing be to abolish Schedule A tax altogether?

Sir E. Boyle: That raises rather wider issues. Perhaps the hon. Gentleman will put some of those other questions on the Order Paper.

Income Tax (Allowances)

Mr. Dempsey: asked the Chancellor of the Exchequer if, having regard to the fact that incomes have approximately trebled since the pre-war days, in order to meet a much higher cost of living, he will increase the Income Tax allowance for married couples to a proportionate level and, at the same time, give effect to proportionate increases for unmarried persons.

Sir E. Boyle: My right hon. Friend has noted the hon. Member's suggestion.

Mr. Dempsey: Does the Minister realise that these categories of Income Tax payers have been bearing an undue proportion of Income Tax contribution for a very long time? Does not he think that these allowances should be brought to a realistic level? Does not he realise that by doing so he would earn the gratitude of all?

Sir E. Boyle: I hope that the hon. Gentleman will not forget that even to raise the married man's allowance by £20 and the single man's allowance by £10 would cost £78 million in a full year, so the hon. Gentleman's proposal to increase the married man's allowance from £240 to £540 a year would be rather an expensive operation.

Income Tax (National Service Men)

Mr. Dempsey: asked the Chancellor of the Exchequer if, in view of the sacrifices, both economic and physical, made by National Service men in the defence of the country's commitments, he will abolish their liability to pay Income Tax.

Sir E. Boyle: No, Sir.

Mr. Dempsey: Does the Financial Secretary realise that this appeal is being made for National Service men? As they are willing to make many sacrifices, including the supreme sacrifice, in defending the country's interests, does he not think that something ought to be done to excuse them from Income Tax?

Sir E. Boyle: We should always be very careful in this House of breaching the rule of universality in the matter of tax liability.

Durham (Government Offices)

Mr. Grey: asked the Chancellor of the Exchequer what recent discussions there have been with the appropriate Civil Service staff side representatives concerning the possible transfer of Government offices to Durham; and if he will make a statement.

Sir E. Boyle: There have been no such discussions. I have assured the hon. Member on a number of occasions, the Government will continue their efforts to find a suitable office for transfer to Durham.

Mr. Grey: This kind of Answer is becoming too silly for words. We have heard it before, and we are getting tired of it. What are the difficulties on the staff side of a Department about moving a Department to Durham? Does the staff side want to go or not? If it does not want to go, may I suggest that the hon. Gentleman apply the simple remedy of asking for volunteers to come to Durham, and thus relieve those who do not want to of the need to move?

Sir E. Boyle: As the hon. Gentleman knows, it is a difficult matter. The decision to remove a large Department, or section of a Department, as far as Durham is obviously a big decision. I know the hon. Gentleman's concern in the matter, but there has really not been anything further to report since he led his deputation to my predecessor last summer.

Suez Canal Company (United Kingdom Shareholders)

Mr. Watts: asked the Chancellor of the Exchequer whether he is aware of the unusually heavy taxation which is likely to be levied on United Kingdom shareholders in the Suez Canal Company as a result of having received a capital compensatory grant; and whether he will take steps to relieve them of this exceptional charge.

Sir E. Boyle: The Inland Revenue has been advised that what the shareholders receive is, in law, income, and not captial. As such, it is taxable in the same way as other income. My right hon. Friend does not think that any special relief would be justified.

Mr. Watts: Does the Financial Secretary realise that the public consider this


as capital, and that it is a monstrous injustice that compensation given to people who have lost money in this way should be taxed?

Sir E. Boyle: I know of the concern of my hon. Friend and of many other hon. Members on this subject. The situation is, as I think my hon. Friend knows, that the distributions are not described as repayments of share capital, because the nominal value of the shares remains the same after distributions have been made, and the Inland Revenue has been advised that, in those circumstances, the distributions are taxable income in the hands of shareholders resident in this country. The question of exempting these distributions either by extra-statutory concession or by legislation was fully considered. I believe that the right decision has been taken but, of course, I note my hon. Friend's views.

Dr. Glyn: Is my hon. Friend aware that in France this repayment, which is, in principle, a repayment of capital, is regarded as such, and is not subject to Income Tax? I agree that it is extremely unfair that the shareholders of this company, who have already suffered very considerably, should have insult added to injury by taxation on a capital gain.

Sir E. Boyle: I do not think that I can add to the Answer—which, I am sorry, may have seemed overlong—that I gave just now.

Covent Garden Opera

Mr. Watts: asked the Chancellor of the Exchequer why, in view of the increased grant to the Arts Council this year, no arrangements have been made for the Covent Garden Opera to visit Manchester; and if he will make a statement.

Sir E. Boyle: As my hon. Friend will be aware, I have no responsibility for the touring programme of Covent Garden. I understand, however, that although Covent Garden Opera is not visiting Manchester this year, Sadler's Wells played there for a week last May. During the next financial year Manchester will, in all probability, be visited once by Covent Garden and twice by Sadler's Wells.

Mr. Watts: Does not my hon. Friend agree that it is monstrously unfair that

when extra money is given to the Arts Council, the Covent Garden Opera Company does not go to Manchester, where there is a large opera house in one of the most musical cities in the world?

Sir E. Boyle: I do not quite agree with my hon. Friend because, as I explained to him in the letter, there are very real physical and administrative difficulties about allowing a tour by the Covent Garden Opera Company. Quite apart from the size of provincial theatres—

Mr. Watts: Cannot they take the train?

Sir E. Boyle: Quite apart from the size of provincial theatres, there are very real administrative difficulties about moving such a very large company, with so much scenery.

Mr. F. Noel-Baker: Can we take it that the Financial Secretary's Answer does not imply that he is satisfied with the present miserable pittance paid to the Arts Council by the Exchequer—which is a disgrace to this affluent society in which we are now living—and the very miserable proportion of that pittance that goes to the Covent Garden Opera Company?

Sir E. Boyle: I advise the hon. Gentleman, if he likes, to attend the debate on this tomorrow.

Mr. Noel-Baker: I intend to.

Hire-Purchase Companies (Deposits)

Mr. Mills: asked the Chancellor of the Exchequer what steps he intends to take to ensure that hire-purchase companies which accept deposits from the public conform to certain minimum standards.

Mr. Barber: As my right hon. Friend the President of the Board of Trade announced on 26th November last, we are considering the desirability of new legislation for the protection of the public who deposit money with many kinds of businesses, including hire-purchase companies. This is a complex matter which will take time to resolve.

Mr. Mills: Has my hon. Friend noted the remarks of the Governor of the Bank of England at Liverpool on 12th February, and will he bear those remarks in mind?

Mr. Barber: Yes. I shall certainly do that.

Mrs. Slater: Is the Economic Secretary aware that there is a great need for steps to be speeded up, as the public are getting robbed time and time again by the malpractices of many of these companies, about some of which I have written to the President of the Board of Trade?

Mr. Barber: Mr. Speaker, I certainly would not go so far as the hon. Lady has gone—[HON. MEMBERS: "Why?"]—for the simple reason that I think that what she said was somewhat exaggerated—but I certainly agree that this is a very important matter, and I can assure her that we shall reach a conclusion as soon as possible.

Post-War Credits

Mr. Boardman: asked the Chancellor of the Exchequer to what extent it remains a qualification for the early repayment of post-war credits for the applicant to be in receipt of National Assistance.

Sir E. Boyle: One of the qualifications entitling a person to claim payment of his post-war credit is that he has been receiving National Assistance for a continuous period of twelve weeks ending after 7th April, 1959.

Mr. Boardman: As this arrangement is denying repayment to many ex-miners whose health has been completely ruined by pneumoconiosis, will the hon. Gentleman again consider, with his right hon. Friend, the desirability of getting rid of this very mean qualification?

Sir E. Boyle: I think that the hon. Gentleman knows that we are most carefully considering the case of the long-term sick, but I cannot, this afternoon, say anything beyond what my right hon. Friend the Chancellor of the Exchequer has already said.

Mr. H. Wilson: Will the right hon. Gentleman bear in mind what I am sure hon. Members in all parts of the House are finding from their constituencies—that the biggest problem arises from tying the repayment of post-war credits to the unemployability supplement? This is causing very great hardship. Will he look at that point, in particular?

Sir E. Boyle: Yes, Sir.

Commander Kerans: asked the Chancellor of the Exchequer whether he will give consideration to extending postwar credits to the long-term sick who come outside the scope of present qualifications.

Sir E. Boyle: My right hon. Friend has this matter under consideration.

Commander Kerans: I have three constituents who have been permanently sick for the last six, three and two years. Cannot some action be taken to alleviate the plight of these unfortunate persons?

Sir E. Boyle: I have had many cases sent to me by hon. Members in all parts of the House in recent months. I cannot add to what I have said in answer to Questions earlier this afternoon.

Mr. Chetwynd: Will the hon. Gentleman bear in mind that this is one outstanding category of persons in urgent need of their post-war credits and that there is overwhelming evidence from all hon. Members that they should be dealt with as early as possible?

Sir E. Boyle: I am sure that my right hon. Friend will bear in mind the views frequently expressed from both sides of the House.

Industry and Agriculture (Aid)

Mr. Swingler: asked the Chancellor of the Exchequer if he will publish a White Paper setting out in detail the current rate of aid annually from public sources to private industry and agriculture in the forms of grants, subsidies, state-guaranteed loans, and research, respectively.

Sir E. Boyle: No, Sir. But I am circulating in the OFFICIAL REPORT a note of the estimated amounts for the current financial year.

Mr. Swingler: That is not quite the point. Is the Minister aware that in the House we are getting, in dribs and drabs, this information about the amount of public assistance, as it was described by the noble Lords yesterday, given to privately-owned industry and agriculture? Could we not have, for the benefit of hon. Members on both sides of the House, an analysis showing exactly how much is being paid and what responsibility the Government have undertaken,


in all the respects set out in the Question, to privately-owned industry and agriculture, showing the extent of State support to privately-owned industry and agriculture?

EXPENDITURE ON SUBSIDIES, GRANTS AND OTHER ASSISTANCE TO PRIVATE INDUSTRY AND AGRICULTURE. GOVERNMENT AID TO PRIVATE INDUSTRY AND AGRICULTURE


1959–60 £ MILLION


—
Subsidies
Capital grants
Loans
Guarantees
Research


Agriculture and Fisheries
…
263
5
6
nil
n.a.


Industry
…
…
…
1
5
14
nil
n.a.

Pensions

Mr. Denzil Freeth: asked the Chancellor of the Exchequer whether he will introduce legislation in order to enable the amount of a pension which has been commuted to be raised in accordance with the increases in the actual pension authorised by legislation subsequent to the date of the pensioner's retirement.

Sir E. Boyle: No, Sir.

Mr. Freeth: Is my hon. Friend aware that the vast majority of pensioners who have commuted part, or nearly half, of their pensions are military pensioners who had to come back to this country to retire? They had to commute their pensions in order to find somewhere to live. An undertaking was given by my right hon. Friend the Minister of Defence on 11th November that he would look into this matter, particularly with reference to military pensioners. Does my hon. Friend's Answer today mean that that undertaking has been fulfilled and that the final answer of all Departments is, "No"?

Sir E. Boyle: My Answer means that the pension increase remains payable only on pensions and not on lump sum benefits. We ought to think very hard before we depart from that principle.

Dame Irene Ward: asked the Chancellor of the Exchequer by what authority his Department decided to arrange for the Secretary-General of the Arts Council, who has a salary of £3,800 per annum, a special pension, although he is over the qualifying age; and if, in view of this decision, he will now agree to implement the recommendation of the Royal Commission that established civil

Sir E. Boyle: I ask the hon. Member to look at the table which will be published in the OFFICIAL REPORT. It is quite a big "drib or drab".

Following is the note:

servants, who were previously unestablished and who are mainly composed of ex-Service personnel living on small fixed incomes, shall have the right to count their service in full for pension purposes.

Sir E. Boyle: The Council decided that, since the Secretary-General was age-barred from its own pension scheme, it was reasonable to arrange to provide him with benefits which were broadly in line with the discretionary provision available for late entrants with special qualifications to certain public service schemes. The Treasury saw no reason to dissent.
The claim for full reckoning of unestablished civil service when it is followed by established service is a quite separate matter. On this point, I have nothing to add to the reply given by the Chancellor to the hon. Member for Bristol, Central (Mr. Awbery) on 1st December last.

Dame Irene Ward: As the decision to give a pension to this high-ranking officer was made with Treasury approval, but without Ministerial approval, at a time when we were being asked to tighten our belts, may I ask my hon. Friend when we shall implement the pledge given by us, when in Opposition, to those in the Civil Service and those living on small fixed incomes? When will our armour be shining bright again with regard to this pledge?

Sir E. Boyle: I think that the hon. Lady is widening the ambit of a Question which was fairly wide to start with. I have nothing to add to my Answer or to the correspondence which I have had with her on this subject.

Industry (Loans and Grants)

Mr. Jay: asked the Chancellor of the Exchequer the total of loans and grants of public money offered or made in the last two years to the steel, cotton, motor car, aircraft and shipping industries; and what part of this total consisted of loans and grants, respectively.

Sir E. Boyle: Since 1st April, 1958, grants of about £30½ million and loans of £120 million have been offered to these industries; grants of about £600,000 have been issued, plus loans of £16 million.

Mr. Jay: Are not these staggeringly large figures of financial aid from the taxpayer to private enterprise? Is it the policy of the Conservative Party that these tens of millions should be handed over to private firms without the taxpayer receiving in return any share of the profits of the firms?

Sir E. Boyle: We cannot debate this matter now, but I say to the right hon. Gentleman—and this is a view with which I think he might sympathise—that it can be a mistake to be too theological about this. It is much better to look at the needs and problems of each industry in turn. If the right hon. Gentleman wishes to put down Questions about them, he might well do so.

Mr. H. Wilson: While always discounting excessive ventures into theology, may I ask the hon. Gentleman whether, from his experience as Economic Secretary—I think he was Economic Secretary—responsible for D.A.T.A.C., it was not Treasury policy in those days to have Treasury-appointed directors to look after the Treasury loans to these companies? Is it not a fact that, despite all that the Conservative Party told us at the election, the Treasury is going a long way towards buttressing up private enterprise with these loans? Should not the State, having shared the risks, share any profits?

Sir E. Boyle: I do not think that D.A.T.A.C. was in existence when I was Economic Secretary. In any case, the first part of the right hon. Gentleman's supplementary question is on a rather different matter. If he would like to put it on the Order Paper, I will gladly answer it at some other time.

Mr. Wilson: Is the hon. Member aware that D.A.T.A.C. has been in existence continuously since 1945 and that he himself has written a number of letters to hon. Members, including some to me, explaining in great detail why D.A.T.A.C. turned down a particular proposition and why he was satisfied that D.A.T.A.C. was right to turn it down? Will he look at this matter again?

Sir E. Boyle: I am grateful to the right hon. Gentleman for refreshing my memory. That was a lapse of memory. If he wishes to put down a Question about D.A.T.A.C. directorships, he had better do so.

Share Transfers (Stamp Duty)

Mr. Farr: asked the Chancellor of the Exchequer if he will consider the abolition or substantial reduction of the transfer Stamp Duty on shares.

Sir E. Boyle: My right hon. Friend has noted my hon. Friend's suggestion.

Mr. Farr: Is my hon. Friend aware that even a small reduction of, say, 1 per cent. in this duty would go a long way to encouraging us to become a nation of share owners and, moreover, would encourage employees to hold an investment in the firms for which they work?

Sir E. Boyle: As I said, my right hon. Friend will note my hon. Friend's suggestion. I cannot make any further comment this afternoon.

Trustee Savings Banks (Cheques)

Mr. Jay: asked the Chancellor of the Exchequer what progress has been made in enabling the trustee savings banks to meet the demand of the public for a limited cheque system.

Mr. Lipton: asked the Chancellor of the Exchequer why he rejected the proposal of the trustee savings banks to introduce a cheque service for depositors.

Mr. Barber: My right hon. Friend has had this matter under consideration and I have recently written on his behalf to the chairman of the Trustee Savings Banks' Assocation explaining certain major difficulties which we see in introducing legislation for this purpose at the present time. But I have invited representatives of the association to


come and discuss the matter with me and I should prefer to defer a statement until after I have heard whether, as I hope, they accept this invitation.

Mr. Jay: Is it not the case that this proposal, which is supported by the whole of the trustee savings banks movement, has been under consideration by the Chancellor for a year and that the letter which the hon. Member has written has been taken as a refusal by the association? If it is not, will he assure us that he will sympathetically examine the proposal?

Mr. Barber: I certainly give that assurance. It would be quite wrong to think that this suggestion has been turned down out of hand. When I wrote the letter I expressed myself in these terms:
I do not think that I can at present give any undertaking to introduce legislation.
I thought that it was fair to point out to the chairman the difficulties which we envisaged in order that he would have an opportunity of discussing them with me.

Mr. Lipton: Will the hon. Member give an assurance that the Treasury is not animated by political considerations in this matter? Is he aware that the trustee savings banks movement is not an organisation for the private profit of individuals? Will he assure us that he has not been intimidated by the well-paid chairmen and directors of the "big five" banks who obviously do not want the trustee savings banks to operate such a service?

Mr. Barber: The Treasury is never intimidated and we are never motivated by political considerations.

Mr. Hoy: The letter to which the hon. Member referred looked suspiciously like a refusal, and we are glad to have an assurance this afternoon that the opportunity still exists. When he undertook consultations, as he did, with certain of the joint stock banks, would it not have been very much more polite of him to have consulted the Trustee Savings Banks' Association about this proposal before sending a letter which was tantamount to a refusal, despite its concluding lines?

Mr. Barber: No, Sir. I think that the hon. Member, no doubt in

advertently, has misunderstood what happened. Early last year the trustee savings banks let it be known in the Press that they had put forward a new cheques scheme. The British Bankers' Association saw the report in the Press and asked whether it could make its views known to the Treasury. It was permitted to do so, and did so in June last year, and there has been no discussion with the British Bankers' Association since then.

Mr. Hoy: Is it not correct that the first overtures of the Trustee Savings Banks' Association were made to the National Debt Office and that these consultations have been going on since the latter part of 1958? Negotiations were started before any public information was given about them. Surely it is right that this organisation, which represents no fewer than 9 million small depositors in this country, should have equal facilities to deal with its customers with those of the joint stock banks?

Mr. Barber: It is for those reasons that I hope sincerely that the chairman of the Trustee Savings Banks' Association will accept my invitation to discuss the matter with me.

Mr. Arbuthnot: Will my hon. Friend bear in mind that time is important in this matter, particularly because the payment of wages by cheques will soon become operative?

Mr. Barber: I quite agree with my hon. Friend. I hope that we can arrange a meeting soon.

Trusts (Tax Deduction Certificates)

Mr. J. Howard: asked the Chancellor of the Exchequer if he will make it obligatory for a trustee and, in particular, the Public Trustee, to provide tax deduction certificates to the beneficiaries of a trust.

Sir E. Boyle: I understand that in practice little difficulty arises and I am not satisfied that any alteration of the law in this matter is called for.

Mr. Howard: Will my hon. Friend bear in mind that many people of small means have had to rely on these certificates to enable them to recover tax which has been deducted at too high a rate? Will he at least ensure that the Public Trustee


does not make a charge for the issue of these very necessary tax deduction certificates?

Sir E. Boyle: Certainly. If my hon. Friend would like to correspond with me on this subject and give me his experience, I shall take note of what he says.

Wages and Output

Mr. Cronin: asked the Chancellor of the Exchequer the relative rates at which wages and national output increased in 1959.

Mr. Barber: I regret that the information on which to base such a comparison is not yet available.

Mr. Cronin: Is it not the case that national output increased at much the same rate as wages increased during 1959? Is not that information available to the Treasury? Also, does not this indicate that the relative stability of prices in 1959 was almost entirely due to the moderation of trade unions in pressing wage claims?

Mr. Barber: The fact is that it is quite impossible at the moment to give the information which the hon. Member requires. Estimates of wages and salaries and of the gross national product for the calendar year 1959 will not be available until the end of March.

Mr. Cronin: Does the hon. Member realise how unsatisfactory his reply is, as this information is freely available in economic journals?

Wage Claims

Mr. Cronin: asked the Chancellor of the Exchequer if he will make a statement on his monetary policy with regard to the pending claims for increased wages, which have been announced by the trade unions concerned.

Mr. Barber: In framing monetary and other policies, my right hon. Friend has to take into account many factors, including the risks of a renewal of inflationary pressures. Moderation in rises in the general level of wages and other incomes has an important part to play in maintaining stability in costs and prices and in enabling a satisfactory expansion of the economy to take place without inflation.

Mr. Cronin: Will the hon. Member at least reassure the House that monetary policy will not be deliberately used to create unemployment in future, as occurred during the last Parliament?

Mr. Barber: The whole question of monetary policy and any other measures which we might take has been explained in great detail by my right hon. Friend the Chancellor of the Exchequer in the debate on the Radcliffe Report and since in Question and Answer.

Mr. H. Wilson: Does the Minister's Answer mean that the Chancellor has decided his policy on wages for this year before even having the figures about what happened last year? Is it not a fact that, for four or five years, successive Chancellors have stood at that Box making the same speeches about wages and that it needed 1959 experience to show that, when the Government accepted our advice and let production rise, it was possible for wages to increase without there being an increase in costs?

Mr. Barber: I am afraid that I cannot accept what the right hon. Gentleman has said. Our policy in this matter will be flexible. [HON. MEMBERS: "Oh."] Our policy is much better than the rigid policies which we had before 1951. We shall succeed only if we have the active co-operation of all sectors of the economy.

Mr. Wilson: Does the hon. Member mean by flexibility a policy under which production was not allowed to rise for four years? In contrasting present-day policies with policies before 1951, will the hon. Gentleman recognise that what he calls rigidity led to an increase in national production more than double that achieved in the last four years?

Mr. Barber: What I meant was that our policies will achieve the sort of satisfactory results which we have achieved since 1951 and which have been endorsed by the electorate.

The Arts

Dame Irene Ward: asked the Chancellor of the Exchequer when he intends to announce increased financial support for the arts.

Sir E. Boyle: I must ask my hon. Friend to await the publication of the 1960–61 Estimates.

Dame Irene Ward: Will my hon. Friend give an assurance that when the money is forthcoming it will be channelled through the Ministry of Education until such time as the Arts Council ceases to buttress its London capital at the expense of the provinces?

Sir E. Boyle: I certainly cannot give any such assurance to the hon. Lady.

Bank Rate

Mr. Ginsburg: asked the Chancellor of the Exchequer what directions he gave to the Bank of England in connection with the recent increase in the Bank Rate.

Mr. Barber: None.

Mr. Ginsburg: I thank the hon. Gentleman for that reply. Has his attention been drawn to a speech made last Friday week by the Governor of the Bank of England in which he said that the main reason for the increase in the Bank Rate was the internal situation? Also, has he noted a statement by his right hon. Friend the Chancellor of the Exchequer that the main reason for the increase in the Bank Rate was the balance of payments position? Can the hon. Gentleman clarify the position?

Mr. Barber: The procedure which was followed on this occasion was that which was described by my right hon. Friend in the debate on the Radcliffe Report on 26th November.

Mr. H. Wilson: While we appreciate all this flexibility, will the hon. Gentleman answer my hon. Friend's supplementary question? Is it not a fact that the Bank of England, when it announced the increase in the Bank Rate, stated that it was because of the internal situation, that the Chancellor has said that it was because of the external situation and that the Governor now says that it was because of the internal situation? Whichever it was, internal or external, will the hon. Gentleman say whether the rise in the Bank Rate has achieved what the Government set out to do when they proposed it?

Mr. Barber: It is achieving what the Government set out to do when the rise took place. After the rise in the Bank Rate, my right hon. Friend came to this Box and answered a considerable number

of Questions about it. I do not think that I can usefully add to what my right hon. Friend said then.

University Entrants

Mr. Wainwright: asked the Chancellor of the Exchequer the number of entrants to the universities in 1957, 1958 and 1959; and the estimated figures for 1960, 1961 and 1962.

Sir E. Boyle: The numbers of autumn term new entrants to the universities and university colleges in Great Britain in 1957, 1958 and 1958 were 27,206, 27,757 and 27,533 respectively. The University Grants Committee estimates that new entrants in 1960, 1961 and 1962 will number 29,500, 31,000 and 32,000 respectively.

Mr. Wainwright: I thank the hon. Gentleman for that information. Is he aware that West Germany spends twice, the United States two-and-a-half times and Russia more than four times the amount we spend on students in this country? Will the hon. Gentleman make certain that university places are available to our students so that we may be sure that our educational standards will be comparable with those in the countries I have mentioned?

Sir E. Boyle: The hon. Gentleman will, no doubt, recall that the Chancellor informed the House on 26th January that he has authorised the University Grants Committee to discuss with universities the possibility of providing an additional 35,000 to 40,000 places by the late 'sixties or early 'seventies over and above the figure of 135,000 places already agreed. We are not, therefore, neglecting university places.

Premium Bonds

Mr. Lipton: asked the Chancellor of the Exchequer what action he is taking to improve the sale of premium bonds.

Mr. Sorensen: asked the Chancellor of the Exchequer the plans of Her Majesty's Government for terminating, modifying or expanding the operation of premium bonds, in view of signs of decline in public support.

Mr. Barber: My right hon. Friend is considering this matter, but I have no statement to make at present.

Mr. Lipton: Will the hon. Gentleman bear in mind that he cannot expect to increase the sale of premium bonds if the odds against winning prizes become greater and greater? If the hon. Gentleman wants to compete successfully with football pool promoters, he will have to increase the prizes very substantially.

Mr. Barber: I can only say that during the forty-six weeks to 13th February this year, receipts from the sale of premium bonds amounted to more than £56 million and the prize money to more than £8 million.

Income Tax Acts (Penalty Provisions)

Mr. Stevens: asked the Chancellor of the Exchequer if the review of the penalty sections of the Income Tax Acts has been finished; and if he will make a statement.

Sir E. Boyle: My right hon. Friend has this matter well in mind, but we must reserve any comment on it until our annual review of financial matters.

Mr. Stevens: Is my hon. Friend aware, as I am sure he is, that my Question derives from the recent Hinchy case, the result of which in the House of Lords has caused grave uneasiness to many people? Does he agree that the House of Commons would never pass such savage penalty legislation today and will he urge our right hon. Friend the Chancellor to take steps to introduce amending legislation without delay?

Sir E. Boyle: Of course, I will bear in mind the points made by my hon. Friend. I must, however, say that the decision of the House of Lords in the Hinchy cas confirmed the interpretation of the law on which the Board of Inland Revenue has consistently based its practice. I assure my hon. Friend that there is no question of the Board claiming higher penalties than in the past.

Mr. H. Wilson: While the Financial Secretary will realise that we on this side have persistently asked for the most effective action against tax avoidance and evasion in all forms, will he recognise that there is considerable concern in all parts of the House about the interpretation which finally has been put upon this law and which, as the hon. Gentleman said, has been the custom of

the Board of Inland Revenue for many years? Is he aware that the interpretation which has now been clearly defined means that there is something arbitrary and capricious about the amount and size of the penalty which can be levied by the Board of Inland Revenue for, perhaps, a quite small act of inadvertence in forgetting to return one's Post Office Savings Bank interest or something similar and that there is a case for the law to be looked at again?

Sir E. Boyle: Of course, when any authoritative interepretation of the law is given, that is just the time when one wants to review the matter again. I must, however, reserve any comment upon it until the review of financial matters has been completed.

Sir H. Butcher: Will my hon. Friend bear in mind that while the judgment may have confirmed the existing practice, it also contained severe strictures upon that practice?

Mr. Foot: asked the Chancellor of the Exchequer whether his attention has been drawn to the observations in the judgment given in the House of Lords in the case of Hinchy v. Inland Revenue Commissioners; and whether he will consider introducing legislation to amend Section 25 (3) of the Income Tax Act, 1952.

Sir E. Boyle: Yes. As my hon. and learned Friend the Solicitor-General informed the House on 30th July last, my right hon. Friend is making a full review of the penalty provisions of the Income Tax Acts.

Mr. Foot: Does the hon. Gentleman appreciate that as the Section now stands, although the Board of Inland Revenue has discretion to remit the penalties, the court has no such discretion? Will that aspect of the matter be borne in mind when amending legislation is considered?

Sir E. Boyle: That, obviously, is the kind of matter which we will review—certainly.

Loans (Rates of Interest)

Mr. Frank Allaun: asked the Chancellor of the Exchequer at what rate of interest loans are being made by the Government to Colvilles, Cunard and


the British Motor Corporation; and what rate of interest the Public Works Loan Board charges to local authorities for housing and other loans of a similar period.

Mr. Barber: The Government have entered into an agreement to lend only in the case of Colvilles. The rate of interest on each instalment of the loan will be determined by the Treasury, having regard to the cost at that time of borrowing by the Government for a similar period.
The Answer to the second part of the Question is 6 per cent.

Mr. Allaun: Are we not entitled to be told at what rate public money is being used? Is it not a fact that it is being loaned at a lower rate of interest to private firms than to local authorities? Will the Minister admit that since 1954 this increase in interest rates has halved the building of desperately needed council houses?

Mr. Barber: I thought I had made it clear in my Answer that as no instalment has yet been drawn by Colvilles, the rate of interest has not yet been determined by the Treasury.

Mr. H. Wilson: This is not good enough. Is the hon. Gentleman aware that when this money is lent, it is lent under the authority of this House and that every one of these cases is highly unusual in character, as the noble Lord the hon. Member for Dorset, South (Viscount Hinchingbrooke) and other hon. Members opposite have pointed out? In these circumstances, is it not right that the House of Commons should know what rate of interest the Treasury proposes to apply in these cases? It is not good enough to say that it is the market rate. Will the hon. Gentleman say whether it is tied to the Bank Rate and, if so, what differential from the Bank Rate is to be applied?

Mr. Barber: The right hon. Gentleman will remember that on 21st January last year, my right hon. Friend the Minister of Power, in reply to a Parliamentary Question, announced the heads of agreement with Colvilles. One of the heads of agreement was that in regard to each instalment of the loan, the rate of interest will be determined by the Treasury. So far, no instalment of loan

has yet been made to Colvilles and, consequently, the time to determine the rate of interest has not yet come.

Mr. Wilson: I remember the Answer perfectly. It was in column 38 of the Written Answers of HANSARD for the day the hon. Gentleman has quoted. We all know it perfectly well by heart, although it was given, I think, by the Parliamentary Secretary and not by the Minister of Power. Will the hon. Gentleman at least undertake that when money is lent, and when the Treasury advances it under this arrangement and under all the other arrangements mentioned in the Question, he will inform the House of the actual rate of interest that has been charged on those occasions?

Mr. Barber: No, Sir. I cannot give that assurance. The assurance which I can give is that I will give full consideration to any Question that the right hon. Gentleman may care to put down to me.

Mr. Mitchison: Will the Economic Secretary answer the Question about the other two cases, Cunard and B.M.C.?

Mr. Barber: I was asked in the Question at what rate of interest loans were being made by the Government to Colvilles, Cunard and the British Motor Corporation. I replied that the Government had entered into an agreement to lend only in the case of Colvilles.

Mr. Allaun: In view of the unsatisfactory nature of the reply, I wish to give notice that I will raise the matter at the earliest opportunity.

Oral Answers to Questions — TRADE AND COMMERCE

Weights and Measures (Legislation)

Mr. Dodds: asked the President of the Board of Trade what progress has been made in preparing a new Weights and Measures Bill; and when it is likely to be introduced.

The President of the Board of Trade (Mr. Reginald Maudling): Preparation of the Bill is well advanced but it will not be possible to find time for it in this Session.

Mr. Dodds: Will the right hon. Gentleman bear in mind that we have


been waiting several years for this Bill? In view of the undertakings given during the General Election, why must it take such a long time? Can the right hon. Gentleman justify these further delays?

Mr. Maudling: I appreciate the hon. Member's concern about this important Measure. It will be a long and complicated matter when it comes forward and I am afraid that there is not time for it this Session.

Mrs. Slater: The right hon. Gentleman must know that the House has repeatedly been promised that the Bill will be brought forward. Negotiations have been taking place with all the varied interests for a long time. Why is it not possible for the Bill to be brought forward much more quickly than the Government apparently intend to do?

Mr. Maudling: It has been a long business to negotiate all this. It is a complicated Measure and I am sorry that there is not time for it this Session.

Resale Price Maintenance

Mr. Dodds: asked the President of the Board of Trade whether he has yet completed his consideration of the possibility of abolishing resale price maintenance in an effort to encourage lower prices and if he will make a statement.

Mr. Maudling: I am studying the working of Section 25 of the Restrictive Trade Practices Act, 1956. But as the Parliamentary Secretary explained in reply to Questions on 26th January, it will be some time before I shall be able to make a statement on this complex subject.

Mr. Dodds: Will the right hon. Gentleman explain why, when it comes to helping the general public, the consumer and the housewife, it takes such a long time? Is he aware that the Government have an obligation to the public? Why has it taken so long?

Mr. Maudling: This is a complex subject. I should remind the hon. Member that it is less than four years since this House legislated on the subject.

Oral Answers to Questions — DR. HASTINGS BANDA

Mr. Stonehouse: asked the Prime Minister why he did not seek to meet Dr. Hastings Kamuzu Banda during his visit to Rhodesia and Nyasaland.

The Prime Minister (Mr. Harold Macmillan): I have nothing to add to the reply I gave to the hon. Member for Blackburn (Mrs. Castle) on 18th February.

Mr. Stonehouse: Is not the Prime Minister aware that there is general satisfaction that while he was in Northern Rhodesia he saw the leaders of the African political parties there, but that there is deep regret that he could not see the recognised leader of the Nyasaland people? Also is he not aware that there is growing concern that Dr. Banda is still in detention after twelve months?

The Prime Minister: When I was in Rhodesia, I saw a very large number of representatives of every variety of opinion, and in Nyasaland I saw, among others, a large number of the representatives of the Malawi Congress Party, which is, I understand, the party of Dr. Banda.

Oral Answers to Questions — EX-MINISTERS OF THE CROWN (DOCUMENTS)

Mr. Bellenger: asked the Prime Minister whether he has completed his consideration of the desirability of publishing, in the form of a White Paper, the existing rules relating to the publication of secret State documents by ex-Ministers of the Crown and others formerly in State service and whether he will make a statement.

The Prime Minister: I have considered this suggestion, but I do not think I can add to the statement made by the noble Lord, Lord Morrison of Lambeth, then Lord President of the Council, on 1st August, 1946.

Mr. Bellenger: Has the Prime Minister consulted his right hon. Friend the Leader of the House, who, when the matter was raised in the absence of the Prime Minister, thought that the idea was well worth pursuing? Would it not save a large number of Questions when there are contentious and controversial publications including State


documents, which are not available to other right hon. or hon. Members of the House and certainly not to historians and others who have a right to know something about these things?

The Prime Minister: There is another Question to follow on which, perhaps, more detail might be given. On the general question, however, Lord Morrison's statement set out clearly the main considerations which have guided successive Governments in dealing with these matters. Each application to use a hitherto unpublished document must be considered on its merits in the light of the general considerations outlined in the earlier statement. I am, of course, willing to consider whether a new set of conventions should be drawn up, but it is not so much a matter of making new conventions as of operating them from time to time. I will certainly give thought to the matter—a great deal of thought and time would have to be given—and if I wished to make any new suggestions, which, after all, would tend to bind future Governments, I would, of course, discuss the matter with the Leader of the Opposition.

Oral Answers to Questions — CABINET DOCUMENTS (SIR ANTHONY EDEN)

Mr. Shinwell: asked the Prime Minister (1) whether he has seen the extracts from Cabinet minutes and documents appearing in The Times which relate to Middle East affairs during the period when Sir Anthony Eden was Prime Minister; and for what reason permission was given for their publication, in view of the general rule prohibiting this;
(2) to which Minister Sir Anthony Eden applied for permission to publish extracts from official documents relating to Middle East affairs during the period when he was Prime Minister.

The Prime Minister: I have not recognised, in the serialised extracts from Sir Anthony Eden's book, direct quotations from Cabinet minutes or Cabinet memoranda relating to Middle East affairs during the period when he was Prime Minister. There are general references to the subject matter of Cabinet discussions and there are extracts from other official documents

relating to Middle East affairs during this period. Sir Anthony Eden submitted the text of his book to me, through the Secretary of the Cabinet. I did not regard the publication of these references and extracts as open to objection.

Mr. Shinwell: Will the right hon. Gentleman say whether Sir Anthony Eden undertook the examination of minutes and Cabinet documents himself personally or whether there was someone operating on his behalf? If the latter, was it not highly improper that anybody outside Government circles or not associated with previous Governments should be permitted to do so?

The Prime Minister: I think that the usual practice has been followed in this as in other matters. I think that it will be found that I have followed exactly the precedent established by my predecessors in regard to other such writings. I want to make it clear, in case there is any misunderstanding, that the only actual quotations from the Cabinet memoranda, for which, of course, approval has to be given by the Queen, were on a matter when Sir Anthony Eden was Foreign Secretary, dealing with Far Eastern affairs.

Mr. Shinwell: If the right hon. Gentleman has perused the book—if he has not seen from the extracts in The Times—will he not agree that it is true that references are made to telegrams which passed between the United States State Department and the Foreign Office? If those telegrams were available to Sir Anthony Eden they would obviously have been extracted from Cabinet documents. Is not that so?

The Prime Minister: We have always had a procedure by which a Minister of a past Administration has been able to consult the files and it has been done normally through the Cabinet Secretary. I think that it will be found that exactly the same precedent was followed by Lord Attlee in relation to the series of volumes published by my right hon. Friend the Member for Woodford (Sir W. Churchill).

Mr. Gaitskell: While recognising that this is not an entirely simple and straightforward matter, may I ask the Prime Minister whether he is aware that


many of us feel that the way in which these conventions have been administered recently has become increasingly lax and that we would not accept the parallel with the memoirs of the right hon. Member for Woodford (Sir W. Churchill) as being something which should always be followed? There was something special about that particular case. Is it not unsatisfactory if, for instance, references are made to Cabinet decisions, as is the case with these memoirs, and to telegrams sent to the United States which, apart from what may be the indiscretion involved, also give a decidedly one-sided picture of the whole affair?

The Prime Minister: What the right hon. Gentleman is saying is something which I am bound to say has occurred to me. Perhaps we ought to treat the war and immediate post-war as something different. It would be a novel procedure, but it was that kind of thing I had in mind when I said that we ought perhaps to consider establishing new conventions for what one might call different times. I have just followed the ordinary conventions up to now, but I would be willing to consider whether we could try and think of a new structure and interpretation—it is not easy to define in words—and if I were able to do so I would certainly consult with the right hon. Gentleman.

Mr. Healey: Would the Prime Minister consider at least publishing the names of the members of the Cabinet referred to by Sir Anthony Eden under the general description of "weak sisters", so as to remove the cloud of suspicion which must otherwise rest on the whole of his Government?

Hon. Members: Answer.

Mr. Shinwell: Would the Prime Minister be good enough to answer my supplementary question, because I think it raises a matter of some importance, namely, did Sir Anthony Eden undertake the task of examining these telegrams that passed between the State Department and the Foreign Office and any other documents appertaining to Government business himself personally or was it undertaken by somebody outside? If the latter, was it not highly improper that somebody outside should have had access to Government documents?

The Prime Minister: I should not like to answer that precise question without notice. It is a matter which I could not answer straight out. I have no doubt that Sir Anthony Eden may have had some assistants to help him, but I will write to him and find out in detail the exact procedure by which he was able to recall the particular document which he wished to use. There is a difference between ex-Ministers having a look at documents and what is published. It has always been a tradition. But when there is a question of publication, what is laid down is that a person must receive not only the authority of the Prime Minister but the Queen's authority, advised by him. There are only two such instances that I can find, relating to the period when Sir Anthony Eden was Foreign Secretary. The general reading of old papers and so forth is another question. Perhaps the right hon. Gentleman will allow me to find out the exact facts, because it is a thing on which it is important to be precise.

Mr. P. Noel-Baker: Since Sir Anthony Eden constantly uses the pronoun "we" and the Prime Minister was closely associated with him in the conduct of affairs at that time, is it not desirable for the Prime Minister to make clear whether he agrees with Sir Anthony's extraordinary account of them?

The Prime Minister: I share, and I am glad to share, the full responsibility I took at that time with a leader for whom I feel the deepest sense of loyalty and respect.

Oral Answers to Questions — AFRICA (PRIME MINISTER'S VISIT)

Mr. Donnelly: asked the Prime Minister what instructions he gave to the United Kingdom High Commissioner in South Africa regarding the issue of invitations to coloured South Africans to meet him at the United Kingdom High Commission.

The Prime Minister: None, Sir.

Mr. Donnelly: Is the Prime Minister aware that this was one occasion when he was in South Africa when, without discourtesy to his hosts, it would have been possible for him to invite coloured people to meet him on British soil? Is


he aware that action or inaction speaks louder than words, and can he explain why he did not invite the coloured people to meet him?

The Prime Minister: Invitations were issued by the High Commissioner in accordance with normal practice. I understand the hon. Member's purpose—that a British Prime Minister should try to make clear what is our view on this matter of the place of Africans in African life. I think that I tried to do that at what seemed to me the most appropriate and, on the whole, most effective moment.

Mr. S. Silverman: When the Prime Minister says that the High Commissioner issued the invitations in accordance with his usual practice, does he wish the House to infer that it is his usual practice never to invite coloured South Africans?

The Prime Minister: I approached this problem of making this visit and the task of trying to make clear what is the British view, and there are various ways in which one can do it. I am bound to say that I think that the one I chose was the most correct and perhaps in its lasting effects the most useful.

Mr. Dugdale: Is the Prime Minister aware that, while all of us agree with the opinions which he expressed, it would have been very much better if they had been followed by the actions which could have been taken by the High Commissioner?

Mr. Donnelly: In view of the unsatisfactory nature of the reply, I beg to give notice that I will raise the matter on the Adjournment at the earliest opportunity.

Oral Answers to Questions — COMMUNISM

Mr. Zilliacus: asked the Prime Minister whether, in view of the statement in the Defence White Paper about the continuing military threat of Communism, he will instruct the Secretary of State for Foreign Affairs and the Minister of Defence to publish a joint statement explaining the nature and extent of this alleged threat in Europe, the Middle East and the Far East, respectively.

The Prime Minister: No, Sir. The military threat to which the hon. Member refers has been made amply clear by the Communist leaders themselves.

Mr. Zilliacus: Is not the Prime Minister aware that a growing number, if not the majority, of the people of this country by this time agree with my right hon. Friend the Member for Ebbw Vale (Mr. Bevan) that Communism is a social challenge and not a military threat, and that the Soviet Union does not want war? Further, does he not think that some corroborative detail is necessary to support the assertion that all the tremendous defence burden is really necessary?

The Prime Minister: As an aphorism I think that the right hon. Gentleman's statement had a great deal of truth in it, but it was not, and I think he would not himself claim that it was, the whole truth. We have all, with general agreement, built the defences of the North Atlantic Alliance and I think, broadly speaking, that throughout the House and the country it is felt that this policy has been justified and that it would be wrong to relinquish it.

BUSINESS OF THE HOUSE

Mr. Gaitskell: May I ask the Leader of the House whether he will state the business of the House for next week?

The Secretary of State for the Home Department (Mr. R. A. Butler): Yes, Sir. The business for next week will be as follows:
MONDAY, 29TH FEBRUARY and TUESDAY, 1ST MARCH—A debate will take place on Defence on a Government Motion inviting the House to approve the White Paper.
At the end of business on Tuesday we shall ask the House to consider the Motions to approve the Council of Europe and the Western European Union (Immunities and Privileges) Orders.
WEDNESDAY, 2ND MARCH—Second Reading of the Civil Aviation (Licensing) Bill and Committee stage of the necessary Money Resolution.
Report and Third Reading of the Requisitioned Houses Bill; and of the Highlands and Islands Shipping Services Bill.
THURSDAY, 3RD MARCH—Supply [4th Allotted Day]: Air Estimates will be considered in Committee on Vote A.
FRIDAY, 4TH MARCH—Consideration of Private Members' Bills.
The proposed business for MONDAY, 7TH MARCH, will be Supply [5th Allotted Day]: Navy Estimates will be considered in Committee on Vote A.

Nationalised Industries (Questions)

Hon. Members have recently inquired about the scope for Questions on the nationalised industries.

With your permission, Sir, may I say that we must adhere to the view that Ministers can answer Questions only on matters for which they have a recognised responsibility. Otherwise, they would inevitably find themselves encroaching upon the managerial functions entrusted to the nationalised boards.

Ministers would, of course, answer for the matters which the industries are required by Statute to lay before them, and for appointments, finance and matters on which they themselves have statutory powers or duties. In addition, they may from time to time be concerned with other questions of broad policy affecting the industries.

There is no hard-and-fast formula by which these matters could be identified and opened to Questions in the House, but provided Questions on the Paper relate to Ministers' responsibilities for matters of general policy, they will consider sympathetically the extent to which they can properly reply.

Mr. Gaitskell: It may perhaps be convenient, Sir, if I confine my questions to start with to the statement made by the Leader of the House about Questions on the nationalised industries, and return a little later to the business for next week.
May I ask the right hon. Gentleman whether it is not the case that Ministers are also responsible for obtaining information, and that if hon. Members wish to obtain information on particular points which are within the powers of the Minister to obtain there is no reason why he should not give that information?
Secondly, may I ask whether the right hon. Gentleman is aware that there is some concern that it is not only a matter of Ministers refusing to answer Questions which some of us think might be anwered, but also a matter of the Questions being refused by the Table? I wonder, Mr. Speaker, whether the Leader of the House could comment on that point, or whether you would care to consider the matter. It is, of course, a greater difficulty for hon. Members if their Questions are refused altogether by the Table than if it is merely the decision of the Minister that he cannot answer them.

Mr. Butler: Naturally, Ministers wish to supply as much information as it is possible to provide if it does not contradict what I was saying, namely, encroach on managerial functions entrusted to the nationalised boards, and falls generally within the broad categories mentioned in my statement. I am sure that my right hon. Friends are particularly concerned to pay attention to what the right hon. Gentleman has asked.
Under the rules of the House the responsibility for accepting Questions comes under your jurisdiction, Mr. Speaker, and I suggest that if we could see how this works out, the difficult task of interpretation being left to you and to the Officers of the House, we would perhaps be able to see whether the spirit in which we have made this statement is being implemented. That is why I stated, in my original statement:
… provided Questions on the Paper relate to Ministers' responsibilities …
I was safeguarding the position of Mr. Speaker and of the Table.

Mr. Gaitskell: Would you give us your Ruling on this point, Mr. Speaker, because, as I have said, there is a difference between Ministers saying that they will not answer a Question which, frankly, gives the House an opportunity of pursuing it, and sheer inability to get Questions on the Order Paper?

Mr. Speaker: Yes, there is a real difficulty here and I confess that I do not know the answer to it. What the Table does is governed by the rules of the House in accepting or refusing Questions. This is a curious instance in which the rules of the House are set


in operation by what Ministers do. It has been the same under various Governments.
I think that the principle is roughly as follows, though I do not want to be held to it, because I am speaking "off the cuff". It is that a refusal by a Minister to answer a Question counts as an Answer, so that the Question cannot be asked again. By extension of that admirable doctrine, a refusal by a Minister to answer Questions in a given category counts as an Answer to all the Questions in that category, so that hon. Members cannot table Questions in that category.
Of course, if Ministers were to say at any one time that they would now be willing to answer Questions in a category in which they had not been willing to answer them before, and would do so publicly—I mean not by means of a private communication to the Table—then that would change the application of the rules of the House in that instance.
I do not know how to change that, and, of course, it would be quite unworkable if Ministers were to give an ad hoc assent relating to a particular Question in a hitherto refusable category. I cannot help the House further than that. The Table must have some consistent principle by which it operates.

Mr. Gaitskell: Perhaps, Sir, you would bear in mind that the right hon. Gentleman the Leader of the House has said that there is no hard-and-fast formula by which these matters could be identified and opened to Questions in the House. If that is borne in mind, the Clerks of the Table might perhaps interpret the Questions put by hon. Members rather more broadly than they have done in the past.

Mr. Speaker: I took it that the Leader of the House was saying that in relation to the hard-and-fast category by which Ministers might not govern their willingness or unwillingness to answer, but it would not be possible to have flexibility at the Table were the Table required to operate on no known principle.

Mr. Peart: The Leader of the House said that he would see how this worked, but there has been no change. The statement made by the right hon. Gentleman really concerns what is

normal practice. If, Sir, as you have said, there were Questions in certain new categories, and the Leader of the House said that we could ask Questions in those categories, then we could accept his statement, but so far as I can see there is no change.

Mr. Driberg: Would you be good enough, Mr. Speaker, to confirm for the guidance of the House that your doctrine of infection by category does not apply to those Questions which are cast in the familiar form of asking the Minister if he will issue a general instruction to a board about a matter of policy, rather than of day-to-day administration?

Mr. Speaker: I think it is clear that this would fall into a field—I do not recall the right hon. Member's precise words—in which the Minister had statutory responsibility, as in the context he has for issuing general directions under the material statutes.

Mr. S. Silverman: May I ask the Leader of the House, whether, in his statement, he was intending to convey that there was to be a new practice, that there were to be new categories, in which Ministers would accept responsibility so that the Table could accept Questions? If that is his intention, would he say what these new categories are?

Mr. Butler: I have stated the statutory powers, responsibilities and the broad points on which Ministers have been in the practice of answering, and I also limited my statement—and this is the answer to the hon. Member for Workington (Mr. Peart)—by saying that we could not encroach upon managerial functions.
The only new point in my statement relates to Ministers' responsibility for matters of general policy. The hon. Member for Nelson and Colne (Mr. S. Silverman) is quite right in saying that there is no very great extension. We shall try to interpret general policy in as broad a manner as we can.

Mr. Shinwell: I had something to do with inserting certain words into two nationalisation Acts. It is perfectly true that the words which govern the responsibility of Ministers are "general policy". The Minister operates within those provisions—"general policy"—


but these words have never been clearly defined. Would it not be possible to provide a definition? It would not require to be a very wide definition, obviously, but a narrow one, yet one that would clarify the situation and enable Questions to be put within the provisions of the new definition?
I would remind the House that at the time the Acts were introduced we were exceedingly anxious not to allow hon. Members to interfere with day-to-day administration. [HON. MEMBERS: "Hear, hear."] That is perfectly true, but a variety of issues have emerged since on which Members desire to have information, and it is quite invidious that they should be compelled to write to the nationalised boards for information and very often not receive answers in reply. Would it not be possible to define what is meant by "general policy"?

Mr. Butler: One of the objects in making this statement was to elicit opinion, because I was not prepared, on the points put to me by Members on both sides and by my right hon. Friends, to go any further today. I find considerable opposition on both sides of the House to the idea of interfering with these industries. I will take up the right hon. Gentleman's invitation and see whether, at a later date, we could carry this further. I do not think that I can go further today.

Mr. Fletcher-Cooke: Is my right hon. Friend aware that there is considerable discrepancy between the attitudes of different Departments in this matter? For example, the Postmaster-General answers, very readily, Questions about the British Broadcasting Corporation and matters connected with it which seem quite detailed, whereas the Minister of Transport does not answer Questions concerned with the British Transport Commission that are quite general. Would my right hon. Friend try to find a way of harmonising these things, if only on the principle that he himself has laid down today?

Mr. Butler: We have always recognised a distinction between the General Post Office and the B.B.C. and the other nationalised industries. I was not speaking of the Postmaster-General's responsibilities or of the B.B.C. today.

Mr. F. Noel-Baker: Could the right hon. Gentleman illustrate his statement by telling the House what effect it will have on a matter about which many of us on this side of the House have lately tried to extract information, either from the Minister of Transport or from the Chairman of the British Transport Commission? We were seeking to find out what we considered to be a matter of general public interest—the membership and, incidentally, the remuneration of the area boards of the railways. We were told by the Minister of Transport that he could not give it because he was not responsible for area boards. We were told by the chairman of the Commission that it was inconvenient to give it, though this sort of information is given by the chairmen of other nationalised corporations. Can we take it that, under the new dispensation, the Minister will use his influence to obtain information from the Commission and give it to the House of Commons?

Mr. Butler: One result of the interest of the House in this matter is that there has been a conference with my colleagues principally concerned with a view to trying to get the answering policy more co-ordinated and equal between the various Departments. That might well be the result of this statement. My colleagues desire to approach Questions put by hon. Members in the House in as sympathetic a manner as possible. That is why I suggest that we should give this matter a trial run.

Mr. Mitchison: I understand, Mr. Speaker, that what you said about the attitude of the Table in these matters depends on the principle that a Minister's refusal to answer a Question in a certain category counts as an Answer to the Question. Are we to understand that that applies only to nationalised industries and, if so, why? Or, if it applies to other cases, what would happen, for instance, if the Foreign Secretary stated that he would not answer any Questions about Germany for the next three years?

Mr. Speaker: I was speaking of the category of the nationalised industries. The House will remember that, in principle, Ministerial responsibility may there exist over a wider field than that in which Ministers—of Governments of any complexion—have been prepared to answer questions. That is why what I


was saying I wish to relate to this matter of nationalised industries now under consideration.

Mr. Ellis Smith: Has the right hon. Gentleman's attention been drawn to the Motion on the Order Paper in the names of the hon. Members for Stoke-on-Trent, dealing with Parliamentary control of finance? Does he agree that there is growing public concern about this matter and, if so, will he give sympathetic consideration to the constructive proposals in the Motion?
[That this House, conscious of the necessity of protecting the historic right of private Members to exercise control over public expenditure and to draw attention to public needs before the granting of supply, is of opinion that it is expedient to set up a Committee, under the chairmanship of Mr. Speaker, to examine and report upon the methods by which, in modern times, Parliament can best be assisted to safeguard its control of finance; and is further of opinion that such a committee should be non-political in its membership, which should comprise Officers of the department of the Clerk of the House, the Comptroller and Auditor General and a qualified accountant.]

Mr. Butler: Yes, I have read the Motion, but I do not think that we could accept its suggestions necessarily as they are made. It is a matter of wide public interest, and I have been engaged in a series of consultations with the right hon. Gentleman the Leader of the Opposition, through the usual channels, and with a number of my right hon. Friends principally concerned. There will be no easy solution of the problem and I do not want the House to think that there is. That there is a problem is, I think, apparent, and if some of us can get together and discuss it. I shall be only too glad.

Mr. Ellis Smith: While I am relatively satisfied with that answer, will the Leader of the House give an undertaking that he will consult the Speaker and the learned Clerks, who are most experienced men in these matters? They should be brought into whatever is being considered.

Mr. Butler: Yes, Sir. I have been doing a certain amount of research into this matter and it appears that the

manner in which we conduct the business of Supply dates approximately from the days of Mr. Balfour, so that it has quite a respectable parentage. If we are to look at this matter, we must look at it sympathetically.

Mr. Gower: While it may be my right hon. Friend's desire and intention to liberalise answering Questions about nationalised industries, there seems to be an irresistible tendency, with the passage of time, for restrictions to increase. Is it not harder now to ask Questions about some Departments than it was some years ago?

Mr. Butler: I am glad to be able to inform my hon. Friend that, following my talks with some of my colleagues, they are in a very good mood, so that we had better wait and see how this works out.

Mr. Speaker: We are getting in a bit of a muddle in the sense that the hon. Member for Stoke-on-Trent, South (Mr. Ellis Smith) went back to the general question of business. Courtesy demands that I should look to the right hon. Gentleman the Leader of the Opposition if we are to go back to that.

Mr. Grey: On a point of order. Will you, Mr. Speaker, give consideration to the fact that we have an important debate following this and see whether, in future, when important debates have to take place, and there is limited time, statements of this kind can be left over to another day?

Mr. Speaker: I must not allow the hon. Member to tempt me into expressing hopes.

Mr. Gaitskell: Can the Leader of the House say when we are likely to have the debate on accommodation for hon. Members? He will have noticed the Motion on the Order Paper.
[That this House, recognising that the accommodation, facilities and amenities available to honourable Members, the staff of the House and the Press are at present entirely inadequate to enable them to discharge their public duties as efficiently as they would desire, believes that the time has come to implement the proposal of the Select Committee on House of Commons Accommodation, 1953–54, for the establishment of a unified control of the Palace of Westminster


under this House; and is therefore of opinion that a House of Commons Commission should be appointed forthwith with the powers and duties proposed in the Select Committee Report, including the consideration of the machinery required to establish such unified control.]

Mr. Butler: As I have pointed out before, we are in the important period of the Estimates. I cannot give an undertaking that there will be a debate in the immediate future, but we have it in mind for as soon as we can arrange it.

Mr. de Freitas: Is the Leader of the House aware that for three days next week, Monday, Tuesday and Thursday, we are to debate matters connected with defence and on two days of next week, Wednesday and Thursday, we are to debate matters connected with aviation, civil and military? In arranging future business of the House, will the right hon. Gentleman see that debates on kindred subjects are spread more evenly throughout the Session?

Mr. Butler: It is a coincidence that we should have the Civil Aviation (Licensing) Bill in the midst of our debates on defence and the Air Estimates. That is not done on purpose. It is a coincidence, but I will examine what the hon. Gentleman has said.

Mr. Zilliacus: In view of the impression created in the country by the announcement that an early warning radar station is to be established, which is to give four minutes' warning, could not the right hon. Gentleman find time for a full debate on civil defence, with particular attention to the Government's announced policy of evacuating 12 million people?

Mr. Butler: On business questions, I cannot answer the merits of the hon. Member's question, but at present no such debate is envisaged, although it would have to be discussed if it were desired.

Mr. Rankin: Can the right hon. Gentleman say what allocation of time is intended on Wednesday as between the debate on civil aviation and the following debate on the Highlands and Islands Shipping Services Bill?

Mr. Butler: I think that we had better see how we get on.

Mr. Donnelly: Can the Leader of the House say how he is getting on in his desperate attempts to have a debate on the railways?

Mr. Butler: I should have thought pretty well.

Mr. Rankin: The right hon. Gentleman gave me a rather vague answer. Altogether apart from how we get on with the civil aviation debate, can he assure us that we will have plenty of time for the Recommittal, Report and Third Reading stages of the Highlands and Islands Shipping Services Bill?

Mr. Butler: Yes, Sir. We do not want to crowd out that important piece of Scottish legislation. We shall see what we can do.

FEDERAL REPUBLIC OF GERMANY (MILITARY FACILITIES, SPAIN)

The Secretary of State for Foreign Affairs (Mr. Selwyn Lloyd): With your permission, Mr. Speaker, and that of the House, I will make a short statement about the possibility of an agreement between the Governments of the Federal Republic of Germany and of Spain for the Federal Republic to have military facilities on Spanish territory.
I heard last month of this possibility. I made it clear that we thought that it would be wiser for Germany to seek the required facilities in countries which are members of the North Atlantic Treaty Organisation. That remains the view of Her Majesty's Government.

Mr. Gaitskell: Is the Foreign Secretary aware that there is widespread concern about this matter on both sides of the House? While we welcome his statement so far as it goes, will he, as soon as possible, make a further and fuller statement?
Secondly, can the right hon. and learned Gentleman at least tell us whether it is his opinion that this is essentially a matter for N.A.T.O., and only for N.A.T.O., to decide, and, if that is so, how it comes about that without any discussion within N.A.T.O., apparently, the German authorities have begun to negotiate on this agreement?
Thirdly, can he assure us that within N.A.T.O. itself Her Majesty's Government will do everything in their power to prevent this agreement coming off?

Mr. Lloyd: There are 10 Questions on the Order Paper for Monday about this matter, which I will do my best to answer. One of the difficulties is to know exactly what is the present position. I am doubtful whether there are, in fact, any proposals, let alone agreements. Certainly, as the right hon. Gentleman said, N.A.T.O. has not considered the matter.

Mr. Gaitskell: If N.A.T.O. has not considered the matter, and a matter of this kind should first go to N.A.T.O., is it not the general understanding, is it not at least implicit in the Paris Agreements, for instance, that a matter of this kind would first have to be approved by the N.A.T.O. Council before Germany acted independently?

Mr. Lloyd: My view is that specific proposals should certainly go to N.A.T.O. first, but I do not think that there are specific proposals.

Mr. Healey: Is it not the case that if the negotiations succeed, Germany will be sabotaging the provisions of the Western European Union Treaty for the control of her armaments? Can the right hon. and learned Gentleman say whether The Times is right in its report from Bonn this morning that the German Government concealed their contacts in Spain on this issue for two months before acquainting the N.A.T.O. Council with them; and that Mr. Strauss flagrantly disregarded advice tendered by General Norstad in sending a three-man mission to Spain last week? Would he not agree that that type of conduct is calculated to undermine Western confidence in Germany's loyalty to the alliance?

Mr. Lloyd: I think that detailed questions of that sort are the kind which I should endeavour to answer on Monday. A number of statements, some apparently official and some inspired, are coming out from a number of capitals in Europe and I had better sort out all those statements before I get drawn into answering these questions.

Vice-Admiral Hughes Hallett: Does my right hon. and learned Friend agree

that Western European Union is affected by this matter even more immediately, perhaps, than is N.A.T.O.? Is it not the fact that the position of all the signatory Powers in Western European Union is the same in one respect, namely, that any base established on the mainlaid of Europe must be open to visits by members of the Arms Control Agency? Can my right hon. and learned Friend say whether the position has been made clear to the Spanish Government and whether the Spanish Government would agree to such visits and such inspections?

Mr. Lloyd: My hon. and gallant Friend is asking me for an interpretation of the revised Brussels Treaty. At present, I am disposed to think that my hon. and gallant Friend has put it perfectly correctly and that bases in Europe should be inspected by the Arms Control Agency. That, of course, is relevant to this project, if it ever comes to anything.

Mr. A. Henderson: Will the Foreign Secretary make it clear that the Government do not share the view, expressed in The Times this morning, that if the Federal Government of Germany take steps to manufacture rockets and nuclear weapons in Spain they would not be in breach of the Paris Agreements of 1954? Surely it would be a flagrant breach of those agreements if the Federal Government sought to manufacture nuclear weapons even in Spain?

Mr. Lloyd: Certainly, it would be quite contrary to the spirit of that agreement.

Sir T. Moore: Will my right hon. and learned Friend say whether I am right in my recollection that no protest was made when the United States established bases in Spain, the United States which is also a partner in the alliance and which did so unilaterally? If so, why should there be a protest now when exactly the same action has been taken by another partner in the alliance?

Mr. Lloyd: Whatever my hon. Friend may say, I still stick to the terms of my original statement. I think that it would be wiser for the Federal Republic to seek these facilities in countries which are members of the alliance.

Mr. R. Edwards: Is the Foreign Secretary aware that negotiations are well advanced for the building of a German missile establishment in Bilbao, and that


in Bilbao that fact is well known? Is he also aware that there are three very large bases in Spain outside the control of N.A.T.O.? Is he further aware that the Americans are now shifting the base from Morocco to Spain?
Will not the Foreign Secretary now agree that the whole of the Mediterranean is apparently to be defended from a Fascist country, although that defence is supposed to be to protect Western democracy? Finally, will not the Foreign Secretary agree that one cannot defend human freedom from a country where human freedom has been blacked out for the last twenty years?

Mr. Lloyd: The question of United States bases goes very wide of the statement which I made to the House. The question of the construction of a factory in Bilbao for making missiles is a matter of which I was not aware. I will certainly inquire into it.
With regard to the general question of our policy towards Spain and our capacity to influence Spanish policies, I would ask the hon. Gentleman and other hon. Gentlemen to consider whether their way of doing it is the right way. I should have thought that the experience of 1946 and the effect that that had on the internal affairs of Spain would have been a lesson to them.

Several Hon. Members: rose—

Mr. Speaker: It is manifest that we cannot debate this matter now. There is no Question before the House.

BUSINESS OF THE HOUSE

Ordered,
That this day Business other than the Business of Supply may be taken before Ten o'clock.—[Mr. R. A. Butler.]

Ordered,
That, notwithstanding anything in Standing Order No. 7 (Time for taking Private Business), any Private Business set down for consideration at Seven o'clock this evening by direction of the Chairman of Ways and Means may be taken after Nine o'clock.—[Mr. R. A. Butler.]

Orders of the Day — SUPPLY [23rd February]

[3RD ALLOTTED DAY]

CIVIL ESTIMATES, ESTIMATES FOR REVENUE DEPARTMENTS, AND MINISTRY OF DEFENCE ESTIMATE, 1960–61.

(VOTE ON ACCOUNT)

Resolution reported,
That a sum, not exceeding £1,370,537,000, be granted to Her Majesty, on account, for or towards defraying the charges for the following Civil and Revenue Departments and for the Ministry of Defence for the year ending on the 31st day of March, 1961.

Resolution agreed to.
[For details of Resolution, see OFFICIAL REPORT, 23rd February 1960; Vol. 618, c. 193–6.]

Orders of the Day — LOCAL AUTHORITY RATE BURDEN

4.3 p.m.

Mr. James MacColl: I beg to move,
That this House, recognising the need for expansion of services administered by local authorities, but noting with concern the increasing burden falling on local rates, as a result of the financial and fiscal policies of the Government, calls upon Her Majesty's Government to give immediate help to local authorities by means of lower interest rates and the full rating of industrial hereditaments; and further calls for a fresh inquiry into the financial relationship between central and local government.
This is a short debate, but its shortness does not mean that it is not of great importance, not only to local authorities in this country but to the people and the ratepayers in the areas of those local authorities. I will come immediately to the point of the Motion and confine myself to going through each aspect of the Motion and developing the argument in connection with it.
The first point is one about which I should have thought there would have been no argument, that the House recognises the need for an expansion of the services under the control of local authorities. That has not seriously been challenged, either during or since the election. If we do not allow our local authorities to expand their social services during what we are told is a period


of high prosperity, they will not be able to expand them during a period when productivity is lower and the country is not so prosperous. If we do not expand our social services now, when will we do it?
The burden of our complaint is not that local authorities have been asked to spend more, or want to spend more, but that most of the large increases that there have been have been in connection either with expenditure over which the local authority has no discretion at all, or on services which it has been under continual pressure from the Government to develop and to increase its expenditure on them. Because of the policies of the Government an increasing burden has fallen on many of these authorities. It has now become so crippling that we are in danger of seeing the whole system of local government—and I do not think that this is an exaggeration—being profoundly shaken. Let us consider education. We had the White Paper, "Secondary Education for All—A New Drive." Those are fine, brave words. Local authorities are urged to get a move on. Following that, we find that the London County Council, after having had its programme cut by the central Government, is still spending an additional £.4½ million on education. That kind of increase in expenditure is to be found among many other education authorities. The Government presumably accept that as being a reasonable and fair increase of expenditure that ought to be incurred.
Let us consider, next, mental health, which is a comparatively new service. Only a few months ago we had the Ministry of Health Circular No. 28/59 directing—not driving, or urging, or persuading, but directing—local authorities that by 1st April next they must submit their proposals for the prevention of mental disorders and the care of persons suffering from them. That is a new service. The Minister has told local authorities to expand, and they have been directed to submit their proposals.
May I pause for a moment to ask the Minister a specific question. Is it intended during the course of the next financial year to introduce a further general grant Order to allow increased grants to local authorities for this now service which is to be developed under

that circular. I would remind the Minister that this was precisely the kind of point that was made during the discussion on the general grant. We say that one of the great weaknesses of the general grant is that a now service will not be reflected in it. There will be no percentage grant attached to it, so either it will be squeezed out altogether or it will take its place at the expense of other well established services which have been taken into account in fixing the figure. Because of that circular, we ought to know what policy the Government will adopt in respect of its effect on the expenditure ranking for general grant.
There are other services which have also expanded. I suppose that the biggest increase has taken place in teachers' salaries. We have had a general grant increase for teachers' salaries, yet, oddly enough, the Financial Times, on Saturday, giving a survey of local government expenditure, said:
Easily the most important factor contributing to the widespread rise in rates is increased expenditure on education as a result of the new Burnham scale for teachers' salaries, which came into force last October.
If that is correct, and presumably the correspondent of the Financial Times contacted local authorities and has not said that without due consideration, something has gone wrong. Either the extra grant is going to the wrong local authorities, or the effects of the increases have not been accurately measured, because teachers' salaries is a service over which the local authority has no control. The size of the staffing ratio, and the size of the classes, are fixed by the Minister. The amount of money to be paid in salaries is fixed by the Burnham Committee. The local authority has no possibility of effecting economies in that service. It seems extraordinary that because of changes of that sort, which are outside the control of the local authority, the Government should not bear their full share of the cost.
What other services are likely to show increased expenditure? The other suggestions put forward by the Financial Times are the prospect of higher police pay—which is a percentage grant—the higher cost of borrowing, following the increase in the Bank Rate, and the steadily growing demands of the roads. Those are matters which are either wholly


outside the control of the local authorities or, as in the case of roads, the subject of considerable pressure from the central Government upon local authorities to incur extra expenditure.
The first point made in the Motion is clear. We welcome and accept the need for increased expenditure for the expansion of local authority services. But that puts an increasing burden on the rates, and we ask the House to consider whether the Government are paying their fair share of the cost of that increased expansion. I know that on the estimates of expenditure submitted by local authorities, and by the amount of grant, the percentage paid by the Government has not greatly altered, taking the overall position. The trouble is that in dealing with local government we are not dealing with global figures.
As in the case of housing, so, in this case, the great weakness of the right hon. Gentleman is that he becomes so obsessed with the ecstatic contemplation of the general that he altogether forgets to look at the poignant realities of the particular. It is the particular situation that faces the finance committees of local authorities and the ratepayers. The global or overall figures are not what affects them.
I want to examine some of the increases in rate poundage which have already been announced. Birmingham and Manchester have both announced an increase of 1s. 6d.

Mr. W. E. Wheeldon: Two shillings and sixpence.

Mr. MacColl: I have a figure of 1s. 6d.

Mr. Wheeldon: For Birmingham it is 2s. 6d.

Mr. MacColl: My authority—the Financial Times—must have slipped on that.
The Lancashire County Council has announced an increase of 1s. 6d. in the precept. The Isle of Wight—which I would not have thought was likely to be carried away by emotional and wild Left-wing moves towards extravagance—has had to announce an increase of 2s. 8d. in its poundage, and in respect of the Middlesex County Council and the Surrey County Council there are increases of 8d.

and 6d. respectively. The important point about all those increases is that they are increases in the rate poundage, although there has been such a substantial increase in rateable values, due to increased valuation. If we compare these figures with those of past years, especially the years before the new valuation, we must remember that they are based upon a bigger rateable value and a bigger assessment.
I want to consider two of these local authority increases in a little more detail. I will take Brighton and Lancashire, one a county borough on the South Coast, the other a large county—mixed industrial and rural—in the North. My authority for speaking of Brighton is the Evening Argus of 20th February. Brighton is faced with an increase of 10d. in its rates, even though it has drawn money from its reserves and cut down its estimates. The total increase in the grant which Brighton has received is £55,000. The product of a 1d. rate is about £15,000, which means that in comparison with an increased burden of 10d. upon the ratepayer the increased contribution by the Government amounts to only 3½d.
I now go to the other end of the country and look at Lancashire. This, of course, is only the precept. The increase in total expenditure is 2s. 4d. Of that, education accounts for 2s. 1d. There is no question of wild extravagance or bad administration, because the major increase is in the service where the control of the central Government is firmest. That increase of 2s. 4d. in total expenditure is met by 10d. out of the grant and 1s. 6d. by way of an increase on the precept. The same thing is happening with two different types of authority in different parts of the country. The main burden of the increase in expansion, due to the Government's policy—which we welcome—is falling upon the ratepayer and not upon the grant.
Whether this is because the formula is working badly and the wrong authorities are getting more, or the estimates of expenditure submitted by local authorities are too low, I do not know, and it does not concern my argument. I am concerned to point out to the House the situation which is inherent in relying exclusively upon a general grant.
In 1958, before the introduction of the general grant, grants for the Lancashire


County Council, taking both the block grant and the percentage grant together, contributed a rate poundage of 31s. 9d. For next year they contributed 26s. 8d., which is 5s. 1d. less. In other words, in Lancashire the contribution made by the central Government is not even remaining steady, but is falling. It has fallen by 5s. in terms of the 1d. rate, again taking no account of the fact that the product of the 1d. rate has been rising. The contribution of the ratepayer has risen.
I now turn to the question of the cause. We say that this is due to the financial and fiscal policies of the Government. I want to mention two of them. There are more, but I want to save time. The first is the rate of interest. I do not want to go into the calculations with which we are all so familiar, but increases in the rate of interest have an enormous effect upon local authority expenditure. People talk in terms of cutting a subsidy here or putting on a subsidy there, but changes in subsidy have much less effect than the changes which take place, quite arbitrarily and without any control on the part of local authorities, in the rate of interest.
The rate of interest has again recently risen, so that local authorities are faced with further increases which are not taken into account in respect of the general grant; that grant is fixed according to a different rate of interest, and increases are not reflected in the general grant until a new calculation is made for the next triennial period.
We can see the folly of the position if we compare two services. Let us suppose that in the same area a modern hospital and a new school are to be built. The regional hospital board has to get a major proposal for capital expenditure on new hospital buildings approved by the Ministry of Health, and it may have rather a scrap to get it approved, but once it has succeeded its battle is over, and the whole cost falls on Government funds. The rate of interest does not affect it.
A school may be built next door and is just as much a part of the Government's social policy on which they cash in at election times as an illustration of how progressive they are. The school is built by the local authority, which has to get the same sort of approval from

the Minister and show that its proposals are within the limits of the cost per place and that its programme can be carried out within the area.
There are very strict controls, and I do not know of any lightening of those controls as a result of the provision of the general grant. The local authority must find the money on the open market, where fluctuations may increase the loan charges that must be paid by the taxpayer and the ratepayer. If it is sensible to carry the cost of a major hospital on Government finances, it is equally sensible to carry the cost of a school.
Then there is the cost of land. Again, this is something which is due to the policy of the Government. I am not saying whether that policy is right or wrong. But as a result of the Town and Country Planning Act last year local authorities have to pay full market value for land; not just the existing use value which would sound reasonable and fair, but the development value, taking into account all future development which is very often carried out by the same local authority that buys the land. If a school is built on a new estate where commercial, residential and industrial development by the council and the provision of transport and drainage services lead to higher land values, the council has to pay the increased site cost due to its own energies.
This becomes part of the burden falling on the ratepayer through no fault of the local authority, but because of the policy of the central Government.
Let me quote again, not from fervent "Speaker's Notes", drafted by someone in Transport House, but the rather gloomy background created by the estates correspondent of The Times in its property market review of 1959. The headline is:
Rise of up to 10 per cent. in price of houses. Strong competition for building land.
The correspondent writes:
One of the most interesting factors in the market was the high prices paid for building land close, and sometimes not so close, to the centres of large cities. Any area of reasonable size zoned for residential development offered at auction during the year produced energetic bidding to figures rising perhaps to £7,000 or £8,000 an acre or even higher in exceptional cases. These figures reflect a scarcity of building land which in some areas is described as being 'at starvation level'.


That is all part of the Government's policy of a free property market, of increasing the value of land and making local authorities pay the full market price for the full development value. If it is argued that it is a good policy, I say that the cost of carrying out services which the Government require should fall on central Government funds and not on the rates. The fiendish pincer grip in which a local authority is held is illustrated by the fact that, on the one hand, its costs are pushed up by the change in the price of land and, on the other, there is an increase of the rate of interest paid on the capital necessary in order to pay the increased price of the land. Against that background local authorities have been trying to grapple with their problems and to get some kind of balance in their financial situation.
What is to be done about it? We say that there is need for immediate help. One most important thing which could be done quickly would be to give local authorities—particularly where they are developing work as part of a Government programme—the advantage of Government finance and lower interest rates. Secondly, there is the rating of industrial hereditaments. It is absurd to keep derating industrial hereditaments. If, as we are told, our industries are reaching unparallel heights of prospertity, it is fatuous to subsidise them at the expense of the ratepayer.
We ask that there should be an inquiry into the financial relations between central and local government. Had we won the last General Election, that is something which would already have been initiated. The Government have had what they called an inquiry, but it consisted, in fact, of a working party of chief officers with the understanding that they were not committed to a policy. There was no consideration of policy; it was purely a technical body. Apart from that, there was a haggle between the Ministry and the local authority associations. There has not been any attempt to hold an objective inquiry into the problem of local government finance.
We do not approach this in any doctrinaire spirit. We are not being dogmatic. But we say these problems should be examined calmly, and that the full measure of Government resources and research, and their knowledge of the

situation, should be behind a high-powered inquiry. Only a Government inquiry can decide what should be done. The inquiry should look at a local income tax. I moved a new Clause to the Local Government Bill on that subject. I am not the sort of person to whom people write letters very often, but I was surprised at the "fan mail" which I received as a result of the Standing Committee discussion on a local income tax. I was surprised at the number of people who made the point that rates are reaching a breaking point and that we cannot go on piling more on to the rates with higher and higher rate poundages. We must find some alternative solution and a local income tax may offer such a solution.
Many of my hon. Friends and hon. Members opposite would not agree with this view and I do not press it. I say that this is a matter which should be inquired into. The Royal Institute of Public Administration had a high-powered unofficial inquiry which came down in favour of it. There is a case for looking again at the rating of site values. The last committee which considered the subject sat at a time when the Town and Country Planning Act, 1947, was still in operation. The inquiry took place against the background of development values being taken into public ownership. That was wrecked by the present Government and, therefore, there is a strong case for looking again for some way of mopping up the enormous increases in development values which was demonstrated in the quotation I made from The Times.
Another matter is the rating of empty property and the assimilation of the English system to the Scottish system. Parliament has approved the rating of empty properties for Scottish local government, but refused it for English local authorities. There are three examples and there may be many others. As I say, I am not concerned to be dogmatic or to lay down the law on the subject, or to say what is the answer. But I maintain that something must be done about the problem because of the heavy incidence of rates which is crippling local authorities. So long as independent policy expansion of local authority services have to take place through the rating system, local councils cannot be as energetic and have the


interest in their work that they should have. It all comes back to the problem of how to increase local revenues. I sometimes suspect that the Government do not really want local authorities to have financial resources, because if they had they would be more independent.
That was the story of Waterloo Bridge. Parliament refused to allow Lord Morrison to borrow money for the London County Council to build a new bridge. At that time the product of the 1d. rate in London was about £¼ million and the council was able to do it out of general revenue. Then Parliament caved in. My hon. Friend the Member for Islington, North (Mr. Reynolds) has told me that precisely the same sort of thing happened in the Borough of Acton. The Government refused loan sanction for a transfer from gas to electric lighting for the highways. Acton said, "We shall pay out of our reserves and revenue." It did so, and, within a few months, the Government caved in and gave loan sanction for the operation.
That is the kind of independence which local authorities can have when they have reasonable reserves, but the average local authority, skimped and crimped by the rigid system of taxation, can only beg for grants because grants are the only source related to ability to pay. The grant comes out of the taxation account based on ability to pay and rates come out of a tax on rents, which is not based on ability to pay. If the Government are serious in wanting their policy of extending the social services to go forward, they have either to take more responsibility for meeting the cost themselves or to look at the whole relationship of central and local government and find a better and more flexible working system of giving local authorities adequate finance to run their affairs in their own way.

4.32 p.m.

The Parliamentary Secretary to the Ministry of Housing and Local Government (Sir Keith Joseph): I beg to move, to leave out from "House" to the end of the Question and to add instead thereof:
welcomes the substantial assistance given by Her Majesty's Government to local authorities and the expansion of local services over the past eight years which this assistance has made possible, approves the principle of giving most

help to authorities in greatest need embodied in the system of rate deficiency grants, and endorses the change from percentage grants to a system of general grants which resulted from the recent review of the general relationship between central and local government".
The hon. Member for Widnes (Mr. MacColl) moved his Motion in a very moderate speech. I would not for a moment attempt to minimise the serious burden of rates, but I hope that in what I am going to say I shall be able to explain and particularly to assert, what is the truth, that the proportion of national wealth, or personal income, taken by rates today and likely to be taken by rates in the foreseeable future is just about the same as it has been ever since the war. There is nothing perfect in that, but at least, despite the large expansion to which I shall refer we are not faced with any increase in the proportionate burden of the rates on the citizens.
Of course, I agree straight away with the hon. Member's comments on expansion. Both sides of the House are dedicated to expansion in the local authority social services, and my party takes pride in the expansion it has been able to achieve. I am not going to give a long list of items, but I may quote the great increase in the number of teachers, the numbers of health visitors, home helps and district nurses, and the vast increase in school places and in schools all of which have taken place in the nine years during which my party have been in power.
There has been a greatly increased volume of housing—on an average 30 per cent. above the Socialist record, and a great drive—[HON. MEMBERS: "No."]—yes, I am saying this in a noncontroversial sense—on average it is 30 per cent. above the Socialist record. There has been an enormous increase in the number of houses built for the elderly, and a huge campaign which already has rehoused 600,000 people from the slums. My point in quoting this is that these are extra services which have to be paid for. As they are or local benefit, surely it is absolutely right that part of the cost should fall on the local ratepayer. What I want to stress above all is that the splitting of the extra cost for these extra services between the taxpayer and the ratepayer is in exactly the same proportions as it has been since the war.
I am not going to reply to the individual cases mentioned by the hon. Member. The exact amount received by the local authority depends not only on general grant but on specific grant, its own expenditure on non-grant-aided services and a number of very technical details. We have had absolutely no complaint from local authorities so far, but if there is thought to be inequity, my right hon. Friend would be glad to hear from any local authority which feels it has a grievance and that the formula which was approved by Parliament has not been properly applied.
The Motion criticises the financial and fiscal policies of the Government, but what the hon. Member did not bring out is that those policies have helped to cure inflation while achieving expansion and that this expansion is of the greatest possible benefit to local authorities and their ratepayers. The result is that extra money spent by the ratepayer or the taxpayer on the services is of real value and is not devoted merely to keeping pace with inflation, as so often happened in the past.
The hon. Member raised three main criticisms, the general grant, interest rates and the cost of land. On the general grant, I can go fairly quickly over the history, because I think it is generally known that help to the ratepayers over the rates used to come through the Exchequer equalisation grant. That was in order to help poor authorities. Specific grants were paid by way of a percentage on expenditure, and this meant that the Exchequer was virtually signing a blank cheque, unless the expenditure was subject to control. Detailed control of local authorities was not a healthy thing for local democracy, and it discouraged the pursuit of economy and value for money. The Exchequer equalisation grant appeared to many to have an admirable object to help the local authority, but to be a clumsy weapon to achieve it.
The Government were not particularly happy about the two main methods of helping local authorities and they put in hand an inquiry, on which the hon. Member poured faint praise. As a result of that inquiry, we had the Local Government Act, 1958. That Act secured two major changes. First, the general grant was substituted for certain specific grants. As the House knows, the

general grant commits the Exchequer for a period of two years or more to contribute an absolutely firm sum for payment to local authorities with no supervision, no controls, no encouragement to irresponsibility about the expenditure and the minimum of interference with local democracy.
The general grant was calculated entirely on the basis of local estimates, so was the supplementary grant which covered unforeseen increases in cost in the grant period. As the cost is split, as I tried to explain earlier, between the taxpayer and the ratepayer, it remains true that if there are unforeseen increases in the grant period, part of the cost falls on the ratepayer whilst part of the cost of all services remains on the taxpayer. That is why it is possible, as the hon. Member points out, for part of the cost of the increase of pay for teachers to fall on the ratepayer although the taxpayer is still bearing the major burden.
The general grant sum, fixed at the beginning of each period, takes into account the desired expansion of the services. It would be a very sad thing indeed if it did not. In answer to the question by the hon. Member for Widnes about the mental health service—a very proper question—I am able to assure the House that provision was made in the first general grant for the stepping-up of the expenditure of the mental health service. It was an increase in the expenditure of 2½ times beyond what had gone before, which is by no means what the total final cost will be; but at the beginning of the service one has to start fairly small.
I wish to assert that local authorities have received in general grant more than they would have done under the old specific grant, because the local authorities' estimates on which the general grant was based were drawn up in the summer of 1958 and they were higher than the estimates drawn up by the same local authorities nine months later for the calculation of their own rates. Specific grants would have meant a percentage of the lower figure as calculated by the local authorities when converted into actual expenditure, whereas the estimates on which the general grant were based were the higher estimates of nine months earlier.
If hon. Members feel that unforeseen increases are omitted in the comparison I have made, I would point out that unforeseen increases occurred in the general grant period and were taken into account and paid by the Government under the General Grant Increase Order, 1959, just as they would have been taken into account had there been a specific grant. So they cancel out. In fact, the Government accepted the local authority estimates in full and even improved on them. In addition, the local authorities have £10 million extra annually as their share of industrial re-rating. We have no complaints from the local authorities about their treatment under the general grant. If they have any disagreement about distribution, my right hon. Friend will be glad to hear from them.
The 1958 Act also substituted the rate deficiency grants for Exchequer equalisation grants. These achieved more precisely and effectively, subject to built-in safeguards against unusual expenditure, the aim of helping most those local authorities who most need help. So any increase in the rate burden cannot possibly be blamed on general grants. In fact, the search for value for money, encouraged by the 1958 Act, is making for increased use of modern management techniques, such as works study, O. and M., and unit costings. So local authorities, in the exercise of their increased responsibilities and independence, are rightly paying more attention to value for money.
The second main complaint is about interest rates. It appears that the Opposition do not like the use of interest rates, but we did not hear what is the alternative. It is common ground in a trading nation such as ours that there must be some central financial direction of the economy. Would the Opposition rely again, as they did in the past, on controls? If the Opposition denies this, it should tell us how it would work. If it denies this, then what kind of alternative is there to a package, which must include as one of its components a rise and fall in interest rates?

Mr. MacColl: The local authority expenditure to which I referred was all under the rigid control which we had from the Ministry. Therefore, we have

both fiscal control through the Ministry and financial controls through the rate interest.

Sir K. Joseph: It remains true that about one-half of local government expenditure is not under rigid control. For this hon. Members opposite have to rely on direct controls, which is what the hon. Gentleman apparently means, or use the indirect weapon we use of interest rates. It is true that money borrowed for a lengthy period when the Bank Rate is relatively high will result, for instance, in houses built with that money being more expensive. But this does not affect only local authorities; it affects all people and all companies in this country borrowing at that time, and is intended to do so.
It is generally accepted that the aim of stability of money with expansion is a worth-while endeavour for the country.
If local authorities decide that, despite a temporary relatively high rate of interest, they must still raise more money, I should like to explain to the House that loan charges account for only 10 per cent. of total local authority expenditure and charges on loans raised in a single year account only, on average, for 10 per cent. of that. Thus, if there is an increase of 1 per cent. in interest rates, the result on the rate burden of the local authority would be only a very small fraction of 10 per cent. of 10 per cent. [HON. MEMBERS: "Oh."] That is a very small fraction. It would cause an increase of only a very small fraction of 1 per cent. Therefore, it has a trivial influence on the rates as a whole; but, of course, it can be extremely important in its effect on an individual house or group of houses.
Although there is no sense in protecting local authorities, rich and poor alike, from the influence of rising and falling interest rates, there is the very greatest sense in protecting the less-well-off tenants from a rise in the interest rates. Four hundred local authorities know how to do this already, and ever more are considering it—that is the adoption of differential rent schemes. That is the way to temper the wind of rising interest rates to the individual tenant who cannot afford to pay.
The hon. Gentleman's third complaint was about the cost of land. Here I find it extraordinary that he was able to


attack the Government while reserving his decision whether the Government's policy was right or wrong. I know perfectly well that the hon. Member agrees with the policy of holding the Green Belt. He knows as well as I that we are an overcrowded island and that there is limited land in this country.
He objected to market price being paid for land compulsorily acquired. I do not know whether the Labour Party want to go on record as being opposed to market price being paid for the compulsory purchase of land. However that may be, I would point out to the House that the increase in the purchase price of land to the market value, as a result of the 1959 Act, was taken into account in assessing the first General Grant. Of course, the poorer local authorities have the benefit of the rate deficiency grant and, in addition, specific grants, particularly for housing, come to the help of all concerned.
As a result, therefore, of the Government's successful financial and fiscal policies, and of the level and form of Exchequer assistance which they are giving to authorities, the burden falling on local rates has increased no more rapidly than the increasing prosperity of the country. Despite the considerable expansion of their services during the last eight years, local authority rates in the United Kingdom have remained around 3 per cent. of the total personal and corporate income of the country, after deduction of direct taxes.
The same proportion of the amount of money which people have in their pockets to spend has continued to be collected in the form of rates. Measured by this test, which seems to me a realistic test, the burden falling on local rates has not increased. There is no good reason to believe that the proportion of net personal and corporate incomes, after deduction of direct taxes, to be spent on rates will increase.
The hon. Member mentioned industrial re-rating. We must remember that in 1956 the rates on industry were increased sharply on revaluation. Again, last year, re-rating was stepped up from 25 per cent. to 50 per cent. The whole subject of industrial rating will have to be considered before 1963.
What are the future prospects? Because of the combined effect of the original allowance made for the development

of services between 1959–60 and 1960–61, and the pay awards to teachers, nurses and other staff, which led to the amending general grant order, the revised general grants for 1960–61 will exceed the original 1959–60 estimates, so that the share borne by the taxpayer of the increased cost flowing from the expanded services and from the higher pay will be maintained. It is likely therefore, as a corollary, that the ratepayers will have to meet their share, though a lesser share, of the extra cost. But each local authority is in a different position, depending upon its finances, its history, its efficiency, its balances and its expansion plans.
It is true that there are a number of recommendations and a few decisions about rates, mostly up and a few down, but I hope that I have shown conclusively that any rate poundage increases are not the result of increases in interest rates, except insignificantly, from which, as I have explained, the less-well-off tenants can be protected by differential rent schemes, nor are they the result of the change to general grant.

Mr. John McCann: It is interesting to hear the hon. Member advocating differential rent schemes. Three times this week right hon. and hon. Members opposite who represent the Army, the Navy and the Air Force in the House have refused to put differential rents into operation in the houses owned by the Services. Why should the Minister argue the claims of a differential rent scheme when the Government refuse to apply it in their own establishments?

Sir K. Joseph: That sounds like an interesting question, which I should like to discuss. Local authority services have expanded, are expanding—[HON. MEMBERS: "Answer."] I was delighted to hear the hon. Member for Rochdale (Mr. McCann) speak in support of the general thesis of differential rent schemes for local authority houses. My responsibility in the House is limited to such housing.
The picture is, then, that local authority services have expanded, are expanding, and will expand. The taxpayers' share of the cost is, if anything, slightly higher than before the general grant was introduced. Rate deficiency grant is a more accurate and effective


means of helping poorer local authorities than was the Exchequer Equalisation Grant. Rates are likely to take about the same share—3 per cent.—of personal and corporate income after direct taxes as they have taken for some years.
Finally, the level of rate poundage in an area is the responsibility of each local authority. The new procedure gives, if anything, more financial help, as much encouragement as ever to expand efficiently where expansion is needed, and much more independence and freedom from control. The use to which local authorities put the help from the taxpayer and their new freedom will be judged by their electorate.

4.53 p.m.

Mr. William Blyton: As I listened to the Parliamentary Secretary's speech I came to the conclusion that he lived in an entirely different world from that which I represent in Houghton-le-Spring. I received a letter this morning from the Houghton-le-Spring Urban District Council, which has sent the same letter to the Minister of Housing and Local Government, protesting very forcefully about the way in which it is cramped by the high interest rates which are being charged on the loans which it has received. I will deal with that later in my few remarks, although I do not intend to take up much time.
I rise to support the Motion so ably moved by my hon. Friend the Member for Widnes (Mr. MacColl) who, in a first-class speech on local authorities, drew an excellent picture of local affairs throughout the country.
From my investigations it appears that the average building tender for a council house has not altered very much since 1951. I will quote the figure given by the Chancellor. The average tender for a house in 1952 was £1,391 and in 1959 it was £1,500. When we consider the interest charges, however, we have a very different picture. If we assume a loan of 60 years at the relevant Public Works Loan Board rate of interest, we find that the interest to be paid on that loan was £3,856 in 1952 and £5,353 in 1959. As the Bank Rate rose again in 1960, this figure is now even higher. If the Press this morning is right, the Bank Rate is to go even higher in the next

few months, and the subsequent burden on local authorities will be heavier than I have indicated.
This has meant that the rent which a local authority has had to charge on this house has increased from £1 4s. 8d. a week in 1951 to £1 14s. 3d. a week in 1959. The abolition of the general needs subsidy has also made it more difficult for local authorities to build, and the Minister should have told us that 262 councils have ceased building altogether, although the need for houses continues in their areas. The December figures show that there has been a serious fall in the building of houses by local authorities in the last two years. Local authorities cannot face the interest rates now being charged, and their progress, not only in council housing but in other things, is being retarded, particularly in Durham County.
According to the Ministry of Housing and Local Government, the cost of running local authority services in 1957–58 was 10 per cent. higher than in 1956–57. It rose to £1,438 million in 1957–58 from £1,315 million in 1956–57. Despite this, and because of the credit squeeze, capital expenditure fell by nearly £324 million, while the debt of the local authorities increased by 7·6 per cent. All these increases in costs are, in the main, due to the Government's policy of dear money. It is possible that 1958–59 will show a little easement of this situation, but we are coming back, I am sorry to say, to the previous position as the Bank Rate is increased. Another increase has been forecast.
It is in no way new to state in the House that local authorities are still finding it difficult to obtain money, particularly short-term loans, at reasonable rates of interest. On the one hand, the Government continually urge local authorities to press ahead with their services and, on the other hand, they force them to cut back expenditure when their schemes are submitted. I could give details, if the Minister wants to know what they are, but I would rather not bother the House with them.

Mr. McCann: School building is a good example.

Mr. Blyton: As a result of the dear money policy, council house rents have to be raised and the rates in respect of other services are raised to meet the increased interest on the loans which


authorities have borrowed to carry out those very services. One gained the impression from the speech of the Parliamentary Secretary that we were living in an El Dorado. My council in Houghton-le-Spring has written to me about the high prevailing rates it has to pay, and it has protested to the Minister. So that the Minister may recognise that he has received this letter I propose to read it to the House. The letter, a copy of which was sent to the Minister, is addressed to the Chancellor of the Exchequer. It says:
I am directed by the Council to register their strong protest against the generally high prevailing rates of interest on loans to local authorities and, in particular, against the recent increase in the Bank Rate which, in turn, is reflected in the increased rates of interest which will be chargeable to the Council in respect of sums which they require to borrow for capital schemes.
The Council deeply deplore the step which H.M. Government have felt it necessary to take, and they instruct me to urge that arrangements should be made to safeguard the position of local authorities in cases where long term loans are advanced by the Public Works Loan Board at the present high interest rates. They hold the view that in such cases provision should be made for the reduction of the interest rate as soon as the position warrants such a course being taken, and they trust that this aspect of the matter may receive early and favourable consideration".
The council is more optimistic than I am.
In my division rents have been increased on council houses, due entirely to the interest the council is charged on its loans. I hope that the Minister will realise that it is the ratepayer who has to carry the high profits which the banks are making.
I heard the Parliamentary Secretary mention the dangers of inflation. It is no use asking working men and women not to ask for higher wages when they see everything going up, like house rents and rates, due to the Government's dear money policy. The Government cannot expect trade union leaders to keep men quiet when they see high profits being made in industry and see the tremendous profits that the banks are making because of the dear money policy. In those circumstances the Government cannot expect men and women not to protest at their standard of life being reduced by higher rents and rates caused by the Government's high Bank Rate.
It is not exhortations we want from the Chancellor to working men about wage increases, but some attempt by him to help local authorities in their loan charges which will prevent them passing the burden on to council house tenants, and to all the people in the district, when the rates are increased to meet the demands of interest charges.
I hope that the protest of my council will have some influence on the Minister, though I am not optimistic, and that we shall have some easement of the burden which is being carried in my division.

5.4 p.m.

Mr. Mark Woodnutt: Mr. Deputy-Speaker, I thank you for calling me so early in the debate, thus sparing me a long period of suspense whilst waiting to make my maiden speech. I ask for the customary indulgence of the House. When the hon. Member for Widnes (Mr. MacColl) opened the debate for the Opposition and mentioned the Isle of Wight and the increase of 2s. 8d. in the county rate, for one horrible moment I thought that the hon. Gentleman intended to make my speech for me. I thank him for not doing so.
I wish, first, to pay a tribute to my predecessor Sir Peter Macdonald, who represented the Isle of Wight in the House for thirty-six years. Sir Peter Macdonald, through his loyal service to the House, the country and my constituency has earned the very high respect of all. I should like to wish him a long, happy and well-deserved retirement.
Many maiden speakers have claimed that their constituencies are the most beautiful in the British Isles. I, without any shame and without any doubt whatsoever in my mind, claim the same distinction for the Isle of Wight. It is rightly known as "The Garden Isle", and the motto on our county coat of arms is:
All this beauty is of God".
Like other offshore islands in a far-off part of the world, the Isle of Wight frequently receives a bombardment from the mainland—not in the form of shells, but in the form of millions of letters from people on the mainland wishing to come to the island for their holidays.
It is worthy of note that many of my right hon. and hon. Friends and many


right hon. and hon. Gentlemen opposite regularly spend their holidays on the island. There have been occasions in August when there have been sufficient members of Her Majesty's Government in my home village of Bembridge to form a Cabinet quorum. On one occasion, several years ago, when the party opposite was in power, it made a decision which had my wholehearted support, namely, to hold weekend Cabinet conferences in the very beautiful town of Shanklin. I say to any hon. Members on either side of the House who have not visited my constituency that a very warm welcome awaits them when they decide to do so.
I support the Government Amendment, but I confess that when the reorganisation of local government finance was first under discussion I had many misgivings concerning the effect of the general grant. I am satisfied that for the country as a whole the general grant system is preferable to the old system of percentage grants. It has the merit of enabling the Minister to budget for a fixed amount of expenditure, and it should stop any tendency on the part of local authorities to spend unwisely. Under the percentage grant system, when it was known that certain local expenditure automatically attracted a percentage grant, there was always the temptation in any case of doubt to decide on the expenditure.
I have been chairman of my county finance committee for five years. Last Wednesday, I had the unpleasant job of explaining the 2s. 8d. increase in the Isle of Wight County Council rate. In the old days of the percentage grant, whenever opinion was divided on whether the proposed expenditure was justified, one was always very tempted to decide in favour of spending, on the basis that the Government paid 60 per cent., or 50 per cent. in any event.
However, as the Minister told us, the proportion of expenditure borne by the Exchequer is still the same as it was under the old percentage grant. The total amount in aggregate, taking all authorities, is more than it previously was, but I have no doubt that certain authorities are adversely affected by the working of the new formula, and my authority is obviously one of them.
I suggest two adjustments to my right hon. Friend's general grant formula which are most necessary and which would not increase the total cost of the whole grant, but would vary the weighting as between different authorities. The first point I wish to make is with regard to all counties like my own, which have static or slightly declining populations. There is provision in the general grant order for calculating a supplementary grant in cases where there is a substantial variation in the population of a local authority. That is very fair and very reasonable, but there is no formula in this grant to enable allowances to be made for counties and boroughs with static or slightly declining populations.
That causes very great hardship because, as the total amount of the general grant is fixed and as the general trend of the national population is to increase, if a particular authority is remaining static it naturally follows that in each succeeding year that authority must draw a smaller proportion of the total amount of grant paid to all.
In the Isle of Wight that has had the effect of increasing our rate—though not entirely on that one point—by 2s. 8d. It means that where the national average percentage of grant to total expenditure is 55·7 per cent., the average in the Isle of Wight is 48·8 per cent., a difference of 7 per cent. That arises because of this static or slightly declining population, and it will get steadily worse from year to year. It appears to me that all authorities having this problem of static or declining population will have this same difficulty. I suggest to my right hon. Friend that it would be a perfectly reasonable adjustment to the formula to make some allowance for that fact.
My second point concerns local authorities, such as my own, where the percentage of retired people over 65 years of age is in excess of the national average. The percentage of such people in the Isle of Wight is, in fact, much more than double the national average. Hon. Members will be aware that there is a supplementary grant of £·45, that is, 9s., for every old person over 65 years of age and for every child under five years of age. It so happens that the cost of old people's welfare, which we all realise is yearly an increasing burden, works out on the Isle of Wight—I am quite certain that we on the island are not exceptional in this matter; it would


be the average cost all over the country—at £3 10s. per year per head of population over 65 years of age.
The grant which all of us get is 9s. Therefore, it is costing just over £3 per head for old people over 65, which is borne by the ratepayers. If every local authority had the same average percentage of old people, it would not matter whether the grant were 9s., 18s., or 30s. because everyone would be bearing the same proportion. But for authorities like my own, which has more than twice the national average of people over 65 years of age, it means that for every single one of them over that age the ratepayer is bearing an extra £3 per head per annum. That, again, has a very big effect on the rate increase.
I suggest to my right hon. Friend the Minister that these are two matters in which he could very fairly consider making some adjustment to the formula to help authorities faced with these problems. He could do it without increasing the aggregate amount of grant paid to the country as a whole.
One final point concerning the rate burden generally. It is, as the hon. Gentleman opposite said, becoming an increasingly crippling burden for some people. I am thinking particularly of people on fixed incomes. Many of these people either pay no Income Tax at all, because their income is too low, or they get marginal relief on their small income. But whenever there is an increase in the rates they have to pay it. We have a mass of these people in my constituency. As I have said, we have double the national average of people over 65 years of age.
I am not so much concerned with council house tenants, in whose case it is possible to have a differential rent scheme. I am concerned with the people living in their own houses, who have no means of avoiding these rate increases. This rate increase of 2s. 8d. in the £ on the Isle of Wight will cost the owner of a modest house with a rateable value of £26 a year an extra 1s. 4d. a week. If an old lady or old gentleman or an old married couple have to find that extra 1s. 4d. a week for rates, then, obviously, they have to go without something else. We can expect the rates to increase indefinitely from year to year.
We have the Albemarle Report, the Crowther Report, the Roberts Report,

the new responsibilities in the field of mental health—they have already been mentioned—and the steady expansion of the education service. This expansion is going on and must go on. No one would wish to stop it. But we must do something to relieve these people who, quite definitely, cannot bear this burden. There are several ways of doing it.
I suggest to my right hon. Friend that the best way would be to have a differential rate scheme. Of course, it would be a very complicated thing to work out, but it would be one way of doing it. Possibly, too, we could have some form of marginal relief. If something on these lines is not done, I am quite certain that at a later date we shall have to consider removing some of these services, which are national services, from the local charge to the charge of the central Exchequer. I hope that very soon we shall have an opportunity of discussing these matters, and I appeal to my right hon. Friend seriously to consider the two adjustments to the formula which I have mentioned. I thank the House for its very kind tolerance.

5.18 p.m.

Dr. Horace King: It is a pleasure, which any other hon. or right hon. Member would also wish to have at the moment, to congratulate the hon. Member for the Isle of Wight (Mr. Woodnutt) on his maiden speech. It is appropriate in a debate on local government that he should have opened with an outburst of local patriotism and paid eloquent tribute to the beauty of the Isle of Wight. I say as a neighbour of his that he did not over-paint the glories of the island in his choicely phrased tribute and anything that the House of Commons can do to encourage people to go from the mainland to the Isle of Wight for holidays has not only his support but the support of anyone who loves the beauty of southern England.
The hon. Gentleman has shown us that he brings to the debate both wisdom and experience of local government which is of great value to us in this discussion, and I am quite sure that we all look forward to the pleasure of hearing the hon. Gentleman again and again in subsequent debates. It is a tradition that one should not refer adversely to anything that a maiden speaker has said, and so I will pay the hon. Gentleman


the added compliment of saying that he showed the traditional loyalty of a Conservative to his leaders—which I sometimes wish my own party would possess—in that the theme of the main part of his speech was, "Though the Minister should slay the Isle of Wight fiscally, yet will I trust him."
The hon. Gentleman began by giving his support to the Government Amendment. Yet he went on to say how adverse the grant formula has been to the Isle of Wight and then proceeded to make part of the case which we wish to put to the Parliamentary Secretary. I wish that the Parliamentary Secretary had been a little less complacent, and had addressed himself mare seriously to the grave and reasoned arguments put by my hon. Friend the Member for Widnes (Mr. MacColl). I agree with the hon. Gentleman on one factual point. One of his main contentions was that if the rate burden had increased, that increase is proportional to the rate of increase of the national income.
If the rates rise just as the national income rises, so the Parliamentary Secretary argued, no one can complain very much. But part of the case—and the hon. Member for the Isle of Wight has just made it for us—is that while the national income is rising there are lots of people in the community who do not benefit by that rise. For the people on fixed income, rate increases year by year present a very serious burden, indeed.
The Minister suggested that we could solve some of the problems by differential rents. The hon. Member for the Isle of Wight suggested differential rates. Differential rates, however, would be a form of Income Tax, and I am one of those who have always thought that the Income Tax is a much fairer way of making the community pay for its social services than is the old-fashioned rate burden. I shall refer to that later.
Those of us who serve on local authorities are in the middle of a tremendous task. We have begun to carry out part of the 1944 Education Act. We have ended the old poor-house system, and are beginning to enlarge the scope of the welfare committees. There has been a revolution in the work of children's committees. The health services that are left to local authorities are by no means

trivial. Indeed, the health work done by local authorities is quite as important in its way as that done by the regional part of the National Health Service. That is illustrated by the fact that in my own county the cost of the work of the health committee this year—we budgeted last Monday—will be £1 million.
Every local authority is trying to grapple with the task of providing a twentieth-century road system for twentieth-century traffic. The fire service that we administer has expanded beyond description compared with the service that we handed over to the central Government during the war. The smallholdings committees of county authorities are only waiting for the Minister of Agriculture to permit them to extend their work. The moment they get the all-clear they will extend that work.
If not every local authority has all the tasks I have mentioned, the county council has them all, the county boroughs have all of these plus housing, and the district councils, while not having some of them, have the important task of housing. If I may illustrate the magnitude of the problem from my own county I think that it will convey to the House just what I am seeking to show. As recently as 1953, the total expenditure of the Hampshire County Council was £6¾ million—seven years ago. Last Monday, we approved this year's Budget—£19 million. Education cost £3½ million seven years ago; this year the figure is over £11 million.
I know that Hampshire's figures are not exactly typical. Unlike the Isle of Wight, which has a static population, Hampshire's population is expanding, particularly the child population. It may be, therefore, that this threefold increase inside seven years is not the average for the country, but I am quite certain that every hon. Member who is also engaged in local authority work will accept that his own figures, if not quite so big, are nearly as great.
I admit, too, that with the colossally increased expenditure has come increased Government aid. Indeed, as the Parliamentary Secretary has said today, the amount of the general grant has been roughly that of the old percentage grant. In the annual haggle that goes on between the Minister and the various treasurers of local authorities


what finally emerges is, roughly, the old percentage grant. Although expenditure has gone up tremendously, the Government grant itself has gone up somewhat at the same rate.
If some authorities are better off with the general grant, as is my own county council, while others, like the Isle of Wight, are worse off, it is only because the formulae—whatever formulae a Minister devises—must break down when it comes to true justice as between local authority and local authority. But, although the general grant has gone up, which was part of the Parliamentary Secretary's case, the rate share of the Hampshire County Council budget is £7½ million compared with a total expenditure—rate-borne and tax-borne—of £6½ million only seven years ago.
Further increases in local authority budgets are inevitable. If we take the pattern, as I have done, from 1952 to 1960—in our own case showing an average increase in expenditure of about £1½ million a year—the rate of increase shows no signs of slowing down. Indeed, I believe that the rate of increase can itself very well increase within the next few years. Let me try to show the House why I think so.
No local authority has as many teachers as it wants. Every local authority is rationed for teachers. Half the secondary school classes are over size—and that figure is the Ministry's. And although every local authority this year faces a much heavier bill than previously for teachers' salaries, it could be much heavier tomorrow if the Ministry was really coping with providing enough teachers and if teachers were getting what they would regard as an adequate professional salary. Sooner or later, both of those factors will have to be taken into consideration. They will add to the cost of education.
The fact is, however, that we are by no means carrying out the 1944 Education Act, and this great historic document, the Crowther Report—which I believe to be one of the two great educational documents of our century—is regarded as Utopian when it merely suggests that we should carry out the 1944 Act; that we should raise the school-leaving age to 16; that we should provide education in county colleges for children from 16 to 18 years of age, and that we should do all that within the

next decade—before the end of the sixties—because the whole essence of the Report is that if we do not take the golden opportunity that is offered somewhere about 1967–68 we shall not get the chance again.
Every local authority in the country—most certainly London; most certainly Middlesex; most certainly most of the authorities with which I have come in contact—wants to build more schools this year than the Ministry will permit. Six per cent. of our children are still receiving secondary education in all-age schools. There is a backlog there, particularly in some urban areas. Indeed, the figure I have just had from the Minister shows the paradoxical position that the urban education authorities are now behind the rural education authorities in getting rid of the all-age school.
The Albemarle Report asks us to end our neglect of youth. At present, Britain spends 1d. out of every £1 spent on education in the service of youth—some authorities spend only ½d. Perhaps I may interpolate here to say that despite this sorry fact, despite the publicity given to the misbehaviour of a small number of juvenile delinquents, I believe our youth today to be as good as the youth of any previous period. But we have still neglected our responsibility towards the young people whom we are turning out of our schools at the age of 15. Indeed, the Minister has accepted a £3 million building programme as a first instalment, to call it that, of the Albemarle Report, and that building programme itself will, as a concomitant, require expanding provision in respect of youth service officers and the like.
Local authorities are at present feeling their way rather gingerly towards their responsibilities under the new Mental Health Act. Here, again, all the figures and plans of local authorities, to judge from my experience of those I know very well, are really exploratory at the moment, and no one can foresee just how far new financial burdens will be imposed on local authorities under the Mental Health Act.
Every local authority in the country, I imagine, like my own, wants to build more roads than the Government will permit. We have held our roads committee budget this year in Hampshire merely because the Minister will not let us build the roads we want. Most local


authorities, if they can once have permission from the Ministry of Transport, are in a position dramatically to increase their expenditure through the roads committees.
Wage and salary claims are by no means ended. The immediate example which leaps to mind is that of the fire services. The fire services of the country are claiming that their present rate of pay has fallen quite out of line with what it was until recently, and we can expect local authorities to have to meet quite soon a claim uder that head.
For all these reasons, it is certain that the cost of local services which has to be met either by rates or taxes will continue to mount year by year, and if we do our full duty by the social services of the country, the rate of increase may be even greater than at present.
I am one who believes passionately in local government. I am sure I speak for the whole House in that. With all its imperfections, the town hall, like Whitehall, is a vital part of British democracy. Local government is older than Parliament and it is as essential in its own way as Parliament. Unless we shift some of the burdens which lie ahead from the shoulders of the ratepayers, either local government itself will be endangered or the resistance of ratepayers will become so strong as to jeopardise the progress of the social services.
I do not today debate the issue between general and percentage grants, but, at the time of the battle of the grants, many of us urged that what local authorities wanted was not the same Government aid, whether by percentage or general grant, but a greater measure of State financial help to local authorities. This Government, on the other hand, have by their policy added to the rate burden. Every local authority today is fleeced when it buys land for houses, for schools, for fire stations and all the rest.
I will give examples from my own authority. In February, 1958, we decided to buy a piece of land for a school in Aldershot—seven acres at £2,834. The vendor discovered that the Minister was passing a Bill through Parliament and refused to sell until it became an Act and was in force. We completed the purchase last Monday, and now we are paying £17,500. That is for a piece of land which was available

at £2,834 in February, 1958. We are buying a piece of land in Basingstoke. In 1957, we were to have those six acres for £3,000. Again, the vendor coyly held his hand until the Town and Country Planning Act, 1959, was through, and that £3,000 has now become £6,000. We are buying 12 acres in Gosport for £21,000. We are buying l¾ acres in the village of Hordle for £2,200, which is rather a lot of money for land in a country village. We are buying five acres in the delightful village of Sway for £5,800.
For every school that we build now, we have to pay three, four or five times the value we should have had to pay for the land before the last Town and Country Planning Act. What is true of schools is, I am certain, true of houses. Land owners "never had it so good".
Hampshire County Council has this year to meet over £1 million in interest and service charges on loans, the equivalent of a 1s. 10d. rate. Despite what the Parliamentary Secretary has said, every 1 per cent. increase in the average amount which a local authority has to pay for the money which it borrows places a very heavy burden upon it. In my own authority, a 1 per cent. increase in the average rate of interest adds to 1the cost of servicing its huge loan a sum equivalent to a 4d. rate. This Government have steadily, during the last few years, pursued a policy of dear money. Dear money may be good for the moneylenders, but I believe that dear money, plus inflated prices for land, brings new burdens to local government, whatever benefit these measures may bring to other sections of the nation's economy.
Good local government and the steady development of the housing and school programmes are jeopardised by the fantastic price we have to pay for the land on which to build and for the money which we borrow for the purpose. I believe, also—I think that the Liberals ought to be with us in this—that the enhanced value of land represented by the price that we are now having to pay for it or, rather, the new real value of the land, has nothing to do with the skill, wisdom or virtue of the land owner but is due to the value which Britain herself has placed on the land by her increased prosperity and need to use the land.
Most of the major items of local government expenditure today are matters of national policy. The Burnham scale negotiated nationally—one of the chief items in local government expenditure—is something that no local authority dare break in the name of independence. I believe that some of the nationally negotiated expenditure on local government wages and salaries, expenditure over which local authorities have no real control, might very well be borne to an increased extent by the central Exchequer.
I speak tonight particularly to support that part of the Motion which asks the Government to set up a committee or some form of inquiry into the relation between central and local expenditure. Let us make no mistake about it: we cannot have the social services without paying for thorn. We cannot meet the challenge of the Soviet Union and America, both of which invest twice as much in education as we do, without sacrifices by the British people. But I believe that the kind of sacrifices which we call upon people to make in taxes bears a much closer relation to the income of the person who has to pay than does the rate burden.
The burden of rates falls heaviest on the old-age pensioner and on the man with a large family, and it has by no means anything to do with the capacity of the ratepayer to pay taxes. Indeed, some of the best off people within a community will pay far less proportionately in rates than the poorer ratepayers do. It is because of the crushing burden of rates on those with fixed incomes and those with large families, and because I believe that the ever-increasing burden of rates as compared with taxes is a discouragement to great but necessary social expenditure, that I ask the Government to think again about their Amendment and to give the Motion moved by my hon. Friend the Member for Widnes their support.

5.39 p.m.

Mr. Frederic Harris: From this side of the House, I wish to congratulate my hon. Friend the Member for the Isle of Wight (Mr. Woodnutt) on the very interesting and informative contribution that he gave us in his maiden speech this afternoon. He obviously spoke with much knowledge

and ability as a local authority man. Those of us who are very interested in local government affairs, such as the hon. Member for Southampton, Itchen (Dr. King), with whose very great support for local government I wholeheartedly agree, look forward to many further contributions from my hon. Friend on such matters in the years to come.
Civil Estimates debates, both the one on Tuesday on the employment areas and this one today on the local authority rate burden, give hon. Members an opportunity to make specific reference, as has been done by the hon. Member for Itchen, to their own local constituency problems and worries. Although I think that the Opposition Motion is rather premature, I find myself in agreement with much of what the hon. Member for Widnes (Mr. MacColl) said in his very interesting speech. I, too, have graduated from local authority work, like many hon. Members, and, therefore, I am very keenly interested not only in local authority issues, but particularly in rating matters.
For many years now, I have strongly advocated the complete abolition of industrial derating, which, to my mind, is absolutely out-dated and out-moded under present-day conditions. As an industrial man, I feel that industry can well bear its full share of rates. This point was made by the hon. Member for Widnes. I think that the fact that industry does not now bear its full share of rates is not only unfair to local authorities themselves, but to householders who have to bear such a large proportion of the general rates.
I tried to do something about this by seconding a Private Member's Bill put forward by a former Socialist Member of this House, but, unfortunately, the Bill was not carried. Nevertheless, I was very glad that the Government reached the stage of adjusting the de-rating to 50 per cent., but I want to put on record that I feel that, in turn, this 50 per cent. should be abolished. I think that it is only a matter of time before any Government will have to face this fact.
The Government have certainly implemented their pledge to increase the Exchequer grant to assist in meeting


abnormal increases in expenditure on former grant-aided services. However, it is true to say, certainly in Croydon, that any increase will not fully compensate for the loss of grant which would have been paid under the old system.
As an example, I should like to give the cost of Croydon's education service. At present, it is costing about £3,550,000. The Croydon Education Committee estimates that next year the increase will be in the region of a further 10 per cent.—about £330,000. Under the specific grant system, Croydon would have been entitled to 60 per cent. of this £330,000, namely, £198,000. The general grant which Croydon will receive in 1960–61 will be £2,112,000, whereas that originally proposed for 1960–61 was £1,947,000. In effect, under the new system Croydon will receive only £165,000 of the £330,000 estimated increased expenditure. This is expected to cover not merely the increased expenditure for education alone, but increases on other grant-aided services—for instance, health, children, fire brigades and many other services to which the hon. Member for Itchen has referred.
It may be true that over the country the general grant system is working well, but there are these specific cases to which reference must be made. I thought that my hon. Friend the Member for the Isle of Wight but a very sound point to the Minister on behalf of the Isle of Wight, to which I am sure consideration will have to be given. I appreciate that the Parliamentary Secretary laid himself open, on behalf of the Ministery, to considering the representations which must be made by certain authorities to the Ministry. On behalf of Croydon, I should like to say that I know that it will wish to make its own specific recommendations.
It seems to me that the ratio of Exchequer grant to rate-borne expenditure over the whole country, which, before the Local Government Act, 1958, was six to five, will tend to reduce. I feel that this was one of the objectives of the reorganisation. But, unfortunately, it means that educational development, in which I am keenly interested, and the cost of which is particularly heavy in a progressive borough like Croydon, which has a very proud

educational record, together with the development of other social services, too, will, under the present system, fall increasingly heavily on the shoulders of the ratepayers and to a lesser extent, as the years go by, on the Exchequer.
Croydon is fortunate in that, due to the far-sighted policy of its town planners, it is still developing rapidly, with ever-increasing rateable value accruing, apart from the separate point of revaluation. As a town, we are developing and building at a fast rate, but it would be futile to pretend and would, indeed, be misleading Croydonians generally, that rates will not continue to increase year by year. This, to some extent, is a disturbing factor which has partly been influenced by the general grant system.
Naturally, where it means provision of more services, we are fully in accord with it and wish to see it proceed. The incidence of the effect of increased rates on individual householders, however, particularly those with small fixed incomes, like those to which my hon. Friend the Member for the Isle of Wight has referred, is something which concerns all of us and is very different from the incidence of Income Tax and other taxation.
That is why I contend that this is yet a further reason for easing the burden on ratepayers generally by abolishing derating altogether. I ask the Minister to keep this point constantly in mind. I am a strong advocate of local government and of local authorities handling their own local services to the maximum degree, because they have knowledge of local conditions which we at Westminster cannot possibly have and because they have locally elected representatives constantly coming before the public for re-election.
I therefore contend that this is a very wise policy and I doubt whether any hon. Member would not advocate that as much local administration as possible should be undertaken by local authorities. It is important that Parliament should not risk breaking the camel's back financially by continually adding unduly to the burden of local ratepayers. I am sure that everyone interested in this subject will feel that that is a real worry and a definite possibility and something which will have to be constantly kept under review.
It cannot be contended that ratepayers would necessarily receive increased services in proportion to the increased rates that they will have to pay. Therefore, in supporting the Government—[HON. MEMBERS: "Oh."] Yes, I support the Government. The criticism is premature at this stage, because the full effects of the present system cannot yet be measured. I am instancing my own problems, as did my hon Friend the Member for the Isle of Wight. I still think that the Motion is premature and that we must see this thing through for the next year of two. I am just pointing out the dangers which I foresee.
I ask my right hon. Friend the Minister to keep the situation under constant review. I feel that many of the problems which are being ventilated today in this debate will concern us all very much in the years ahead.

5.51 p.m.

Mr. James McInnes: It was a great pity that the hon. Member for Croydon, North-West (Mr. F. Harris) should destroy an otherwise good contribution to the debate by indicating that he nevertheless supported the Amendment. The hon. Member's experience is the same as that of most of us throughout the country.
I make no apology for speaking solely in respect of Scotland, because no Scottish Minister is present. Whether the Scottish Ministers are too scared to defend the situation, I do not know. I know that the Minister for Housing and Local Government and Minister for Welsh—not Scottish—Affairs will make no effort to defend the Government concerning Scotland.
For obvious reasons, a short debate of this character can throw only a mere shaft of light upon the financial problems that confront local government. In Scotland, never in the history of local government has the financing of capital and ordinary expenditure become such a grave and serious problem.
Today, local government in Scotland is faced with the situation that either it must provide the essential social services, and thereby face the necessity of imposing an intolerable rate burden, or, on the other hand, it must restrict or curtail, or even abandon, these vital services. If it does so, it will create untold hardship

for its citizens by the failure to build houses, schools, libraries and things like that.
This dilemma in which local authorities find themselves is, I hope to show, simply the result of the financial policies pursued by the Government. I find, for example, that the net capital debt of Scottish local authorities has increased from £250 million in 1950 to £668 million in 1959, an increase of over 170 per cent.
I wish to deal with the ever-increasing rate burden which we have seen over the last seven or eight years in Scotland. The total rates collected by Scottish local authorities in 1945 was £25 million. In 1951, six years later, the total was £32 million. So that in the six years from 1945 to 1951, the total rates collected in Scotland increased by £7 million. Between 1951 and 1959, however, the total rates collected jumped from £32 million to £70 million, an increase in eight years of £38 million. Nobody in this House will attempt to deny that that increase is an intolerable burden on the people of Scotland.
It is significant that in 1951 the average rate in Scotland was 13s. 10d. in the £, but that in 1959, after eight years of suffering the policies of the Government, the average rate in Scotland was 23s. 9d. in the £. In other words, during those eight years under the present Government, the ratepayers of Scotland had to face an increase of 9s. 11d. in the £ in their rates.
Let us consider the impact of the rates on the four cities in Scotland. In Glasgow, between 1951 and 1959, the rates increased from 15s. 4d. to the fantastic figure of 27s. 7d.; in Dundee, from 14s. 11d. to 22s. 11d.; in Aberdeen, from 14s. 3d. to 25s., and in Edinburgh—Conservative Edinburgh—from 8s. to 18s. In fact, Conservative Edinburgh shows an increase of 110 per cent., a higher percentage increase than any other city in Scotland.
I should warn the suffering ratepayers of Scotland that next year they are in for the shock of their lives, because they will then feel the full impact of the Valuation and Rating (Scotland) Act, 1956. We all know what happened south of the Border when the review took place in 1955–56. The total rateable value in England and Wales was £362 million, but in 1956–57 it jumped to £629 million,


an increase of 75 per cent. in the total rateable value. The Scottish ratepayers, therefore, can look forward with the maximum pleasure to the compassion shown by the Government next year, when they will be faced with a situation of that kind.
It is frequently asserted, not only by people in Scotland, but even by members of the Government, that these high rates that we tolerate in Scotland are to an extent indicative of the inability of the local authorities to charge what they regard as a fair and reasonable rent for local authority houses. The fact remains, however, that those local authorities which charge not only a fair rent, but, in some instances, what I regard as an excessive rent, are among the local authorities whose rates have gone up and up.
Edinburgh, for example, has the highest percentage increase of any of the four cities, and yet Edinburgh's rentals are almost twice those of the City of Glasgow. In any case, we cannot continue year after year to increase rents to cover up the weaknesses of the financial policy pursued by the Government.
I hope that the Joint Under-Secretary of State for Scotland, whom I am now glad to see in his place, will recognise that in the last three years at least 70 per cent. of the Scottish local authorities have increased their rents, indeed to the extent of almost £3 million, to meet the arguments and the policy which the present Government have adduced, and millions and millions more in rates That is the situation.
This, however, is not merely a matter of rentals. There is something more fundamental to this than increasing the rents of local authority houses. I want to quote from a Question which I put to the Secretary of State for Scotland on 30th July, 1959. I asked the Secretary of State:
if … he will state the total annual charges debited to the housing revenue account of a local authority in respect of a four-apartment house built and provided with money borrowed from the Public Works Loan Board for 60 years as at December, 1951, and December, 1958."—[OFFICIAL REPORT, 30th July, 1959; Vol. 610, c. 173.]
The reply revealed that in 1951 the total annual charge debited in respect of a four-apartment house was £54 19s. 2d. That is what it cost the local authority

each year for sixty years to provide that four-apartment house, but that was the figure in 1951. It had gone up since then from £54 to £120 13s. 7d.
Let us examine that further and take it over the whole period of borrowing of sixty years. If the 1951 figure had remained throughout the sixty years, the house would have cost Glasgow Corporation or any other Scottish local authority £2,298, but under the present Government the cost works out at £7,241. The Government want local authorities to increase rents year after year in order to cover up a policy of that kind.
I shall confine my remarks to the question of high interest rates and leave other hon. Members to deal with other financial aspects of the Government's policy. High interest rates not only affect housing. They affect other essential social services such a schools, libraries, streets, bridges, health and welfare and cleansing. All these items of social services involve capital expenditure and involve the local authority in borrowing money at a very high cost of 6½ per cent. and even 7 per cent. interest. Is not that an intolerable burden to impose on local authorities?
The Minister and his hon. Friends have the audacity, if I may use that word, to put in the Amendment the words:
That this House welcomes the substantial assistance given by Her Majesty's Government to local authorities. …
Where is the substantial assistance they have given to the local authorities to build houses? The assistance they have given is to have cut the housing subsidy as well as increasing interest rates.
High interest rates are a remarkable feature of present Government policy. It seems that interest rates, be they the Bank Rate or the Public Works Loan Board rate, are a seasonable burden to be imposed. The Bank Rate has been altered fifteen times since the present Government came into office and the Public Works Loan Board rates nineteen times. I wonder how the right hon. Gentleman expects any local authority treasurer to be able to plan ahead in developing the social services when he acts as a Judas Iscariot one minute and the archangel of purity the next. Obviously, he cannot carry on doing this, and what a headache he must be giving these local authority treasurers.
High interest rates, however, are not the only feature in this matter of capital expenditure and borrowing. The Government even take the opportunity of compelling the large authorities in particular to seek their capital requirements in the open market. When they went into the open market, these large authorities found themselves competing with colonial Governments and with industry and commerce. It is no wonder that the experience of Scottish local authorities was such that they gave up any idea of doing it. Tory Edinburgh, for example, with its adherence to the Tory Party policy and the present Tory Government, went to the open market and had the experience of having 70 per cent. of its issue left in the hands of the underwriters. Glasgow and other local authorities had a similar experience.
I can well remember the hon. Member for Wolverhampton, South-West (Mr. Powell), when he was Financial Secretary to the Treasury, declaring that the transfer of the main problem of financing local government capital investment from the Public Works Loan Board to the open market had been a very important element in the measures which the Government took to counter inflation. I think that I have demonstrated with the figures I have given that the expenditure and the capital investment went on and that local authorities, rather than restrict, curtail or disband the essential social services, decided with some courage to go ahead and meet the consequences—and the consequences lie in the high rate burden which the ratepayers of Scotland have to bear.
I know from local government experience—and the hon. Member for Croydon, North-West will probably concede this to me—that local authorities distrust the Government and the Government distrust local authorities. In a situation of that kind, one cannot achieve very much. Therefore, I agree with my hon. Friend the Member for Widnes (Mr. MacColl) that there should be a full inquiry into the financial relationship between the central Government and the local authorities. On the one hand, my hon. Friend suggested the introduction of a local Income Tax system as recommended by the Royal Institute of Public Administrators, whilst, on the other hand, consideration

might be given to the rating of site values.
Indeed, one might go further and say that such an inquiry might result in being able to formulate other sources of revenue for local government. Above all, what we want in the interval between now and the time when such an inquiry takes place, is courage on the part of the Government to bring down the high interest rates with which local authorities find themselves faced today. It is because of these things that I associate myself wholeheartedly with the Motion.

6.10 p.m.

Mr. John M. Temple: I am pleased to follow the hon. Gentleman the Member for Glasgow, Central (Mr. McInnes), although, naturally, he will not expect me to follow him into the details of Scottish finance. However, I hope that I shall deal with his criticisms of high interest rates in the course of a few words. I believe that, having accepted the fact that there is an increase in the social services, and that there are to be improvements in them—which has been generally accepted throughout the country as well as in this House—we must necessarily find the means.
I will deal with the Opposition Motion in the reverse order from that in which it is placed on the Order Paper, because the hon. Gentleman ended by referring especially to the financial relationship existing between central and local government. Although that comes last in the Opposition Motion, it is the heart and centre of the problem. May I say here that when I refer to figures I shall refer to those embraced within the general grant Order and I will generalise by saying that today 60 per cent. of the expenditure under that Order is a subvention from the central Government, 40 per cent. is found by the local authorities, and of that 40 per cent. the bulk is found from rates.
If local government is to be an entity in itself, if it is to be local and if it is to be vital, it must have a source of local revenue. Would it not be unreasonable if that source of local revenue were a smaller percentage than 40 per cent.? Indeed, local government would only be a department of the central Government if it were raising only 20 per cent. of its revenue on its own account. Therefore, I shall seek to show that there are possible alternative sources of revenue,


which I will examine, but I believe that, in the end, we shall reach the conclusion that rates, with all their inequalities, are possibly the best source of local revenue known at the present time.
The Opposition Motion refers to the burden falling on local authorities. I agree that there is an inequality of incidence as regards rates, but I was particularly interested to hear the hon. Gentleman the Member for Widnes (Mr. MacColl) refer to a local income tax. I heard a lot of "Hear, hears" from the back benches opposite, but did those hon. Gentlemen realise what local income tax would mean? I sat on the Standing Committee when the hon. Member for Widnes moved an ingenious Clause proposing a local income tax limited to 3d. in the £, to be levied on gross incomes down to £100, so that people with very small incomes indeed would be brought within its embrace.
Did the hon. Gentlemen who were saying "Hear, hear" to that suggestion today realise that it would mean a vast increase in the staffs of local authorities or of the Inland Revenue, because no one knows today which people have incomes as far down the scale as £100? Did those hon. Gentlemen realise that all the incomes of everybody in the country would become known to the local authorities? Further, did they realise the one great central difficulty of a local income tax, namely, would it be levied where a man works, or where he lives? That is a very real problem.
If hon. Gentlemen opposite who support the suggestion have faced those problems, then I would say, go ahead, but, if not, I believe that they will realise, when they think about what I have said, that a local income tax would present great administrative difficulties.

Mr. McInnes: I am aware of the difficulties, as are all local authorities, of operating a local income tax, as suggested by the Royal Institute. The obvious reason for an inquiry into the financial relationship would be to find out how best the procedure could be simplified, if at all, in the interests of local authorities.

Mr. Temple: I have already dealt with the relationship and I am pointing out the administrative difficulties which I have no doubt would be considered at

an inquiry of that nature. The only other concrete suggestion for a local revenue tax is the taxation of land values. That has been tried frequently in the past. Lloyd George tried it in 1910, it was abolished in 1920, and the amount of revenue raised did not cover even the cost of valuation. So I believe that however attractive superficially it may seem, taxation of land values is administratively impractical.
I will make one suggestion to my right hon. Friend, because I know that in answer to a recent Question he said that he would introduce legislation concerning movable dwellings—

Mr. Arthur Holt: If that is all the hon. Member intends to say about the taxation of site values, would he not agree that it operates effectively in many parts of the world, including Denmark and Australia?

Mr. Temple: That may well be so, and if the hon. Member catches your eye, Mr. Speaker, no doubt he will deploy that argument. I am speaking against the clock and, therefore, I did not deploy all my arguments on the taxation of site values.
I was saying that my right hon. Friend has given an undertaking to introduce legislation concerning movable dwellings. I am concerned with the type of movable dwelling which does not move and of which there are many throughout the country, namely, residential caravans which it would be a big problem to get mobile. There may well be a case for rating those so-called movable hereditaments which never move, on the basis of an assessment of each caravan, since I believe they are different from itinerant caravans.
I will mention now another source of local revenue which, however, is more suitable to a country with a federal Parliament; in other words, a country with States within itself. A local sales tax would be a possibility and this has been tried in many parts of the world. To my way of thinking, however, if it were operated by local authorities its incidence might be uneven since local authorities within England and Wales, and indeed, Scotland as well, can be comparatively small in size. Therefore, I come back to the inescapable conclusion that, with all their drawbacks,


rates are a fair way of raising local revenue.
I said to the hon. Member for Glasgow, Central that I would not run away from his main criticism of high interest rates. One must remember that 20 per cent. of the national capital expenditure is made by local authorities today. As I see it, there are only two ways to bring about lower interest rates. One is that if we accept that Britain can insulate itself from the effects of the world overseas which, of course, is a possibility. We could withdraw from our international markets, we could cease to be an international trading nation, but I believe that the assets which accrue to us because we are an international trading nation, because we are a great centre for terminal markets, because of our predominance in insurance—all those factors far outweigh the advantages of withdrawing within ourselves and insulating ourselves from the interest rates that operate overseas.
There is no other way of achieving artificially low interest rates for local authorities other than having a differential rate. I have great sympathy with the local authorities in their problem of high interest rates. They are certainly in a different position from most business and commercial concerns. The value of money largely depends upon the velocity of circulation, and there is not much of that about a sewage plant or a reservoir, so I have sympathy because most local authority investment is of a type where that velocity is almost at zero.
Having said that, I have certain other pet hobby horses. I would like to see lower interest rates for home ownership. Other hon. Members would like to see lower interest for nationalised industries. Therefore, one is forced back to the conclusion that if one accepts a differential in interest rates the only way in which that can be met is by subventions from the central Government, and where are these to come from? In the end, they come from British industry, because industry carries the whole of our economy. It is industry, directly and indirectly, which is providing the basis of taxation. So, attractive though it may seem to have a differential in interest rates, I believe the wisest course is to have the same level of interest rates all over the economy at one and the same time.
I have studied this other item mentioned in the Motion, the rerating of industry. Industry has just been rerated to the extent of 50 per cent.; its rate burden, relatively, has been doubled. The right time for this to come up for serious consideration is in 1963, when rateable values will be brought on to a basis of current values throughout the whole rating structure.
I am pleased to see my hon. Friend the Economic Secretary on the Front Bench, because the Motion mentions fiscal policies. There is one item of fiscal policy to which I should like to draw the attention of my right hon. Friend the Minister of Housing and Local Government, and I hope that he will draw the attention of the Chancellor of the Exchequer to this problem as well. I believe that we have largely accepted the fact that local authorities are in the same position as the central Government regarding the raising of loans and mortgages.
There is a strong case for putting the local authorities in the same position regarding the incidence of Stamp Duty. Today, all the loans of the central Government are transferable free of Stamp Duty, but the loans of the local authorities, those raised prior to 1953, bear a rate of Stamp Duty on transfer of 2 per cent., and those issued after 1953 on transfer bear a rate of Stamp Duty of 1 per cent.
The local authorities themselves pay this rate of Stamp Duty and the purchaser of the particular stocks does not pay it, but, nevertheless, it is a considerable burden on the local authorities. I feel that the local authorities, having achieved trustee status for all their stocks—however small those authorities may be, they are virtually in the same position as the central Government as regards borrowing—there must be a strong case for putting them in the same position when it comes to the incidence of Stamp Duty.
I know that in saying this I have the full backing of the Association of Municipal Corporations. The association did not suggest that I should make these remarks, but after I had thought this matter out I had consultations with the association and—as I think my hon. Friend the Economic Secretary will see if he turns up the files—the association


made representations to the Chancellor of the Exchequer on this matter last June. This is a small point, but it is important and I hope that it will have consideration at the highest level.
I believe that the percentages comprised within the general grant—the percentage raised locally and the percentage which comes from the central Government subvention—are just about right, and I endorse the principle of the general grant, which puts the decision on spending where it should be—in local hands. All the evidence I have at my disposal—and I do go round the local authorities a good deal—is that great progress is being made by them in the social and educational services which they administer.

6.25 p.m.

Mr. Michael Stewart: We have had a brief but very vigorous debate and I am glad that it was long enough to include the speech of the hon. Member for the City of Chester (Mr. Temple), because that enabled the Government to have one—if only one—wholehearted supporter during these proceedings, as those who have heard the speeches of the hon. Member for Croydon, North-West (Mr. F. Harris) and the admirable maiden speech from the hon. Member for the Isle of Wight (Mr. Woodnutt) will agree. We are sorry that the debate has to be so brief because we gathered from what the hon. Member for Croydon, North-West said that if we were to prolong the debate for another two years he would be prepared to come with us into the Lobby at the end. I am sorry in some ways that we cannot do that.
The hon. Member for the Isle of Wight made a maiden speech which we all thoroughly admired, and said he felt some alarm when my hon. Friend the Member for Widnes (Mr. MacColl) referred to the Isle of Wight in case he might be going to make his speech for him. But when I heard the hon. Member for the Isle of Wight speak I had exactly the same anxiety, because he described the heaviness of the burden of the rates, the way in which it was exacerbated by some of the policies of the Government, the inequities of the block grant as applied to his constituency, and the need for further study of this problem. That is practically all we have

been asking for. I will only briefly sum up what I think are the main issues.
The services administered by local authorities, financed partly from rates and partly from taxes, have got to expand. Nobody disputes that. This fact is imposing a serious and growing burden on the people who actually have to pay the rates. That is increased by the nature of certain Government policies, and, finally, we have to consider what action must be taken in this situation.
First, there is the fact of expansion. The Parliamentary Secretary gave us the usual Government recital about how many more schools have been built and how many more of this, that and the other. He is aware, of course, that the number of children has increased considerably in the last eight years and the Government have had no choice in this matter. Whatever Government were in power, there had to be a great expansion of these services. The question at issue is not whether the Government have given more assistance—they may well be doing so—but whether that assistance has been adequate to the nature of the problem, considering how much expansion was needed and the way in which local revenues are raised.
When we come to the size of the burden, the Parliamentary Secretary spoke as if the rate burden was not so much. I cannot think where he got that idea, and it is not shared by anyone else in the House, with the possible exception of the right hon. Gentleman the Minister for Housing and Local Government, as we may learn in a few moments. He suggested that rates did not amount to more than a greater proportion of the total national income now than they did fourteen years ago. I think that was roughly his comparison.
Let us consider what has been happening over the last seven years. Let us take the average ratepayer's position now and seven years ago. For every £5 that he had to fork out in rates seven years ago, he now has to fork out £9. That is the nature of the increase for the average ratepayer, an 80 per cent. increase in the money he pays. Allowing for the fall in the value of money, resulting from the policies of stability described by the Parliamentary Secretary, the increase is 45 per cent. Will


anyone suggest that his real income has risen by 45 per cent., or that the national income has risen by that percentage in the last seven years? Those figures are a measure of the real increase in the rate burden.
Those figures come from the Institute of Municipal Treasurers and they refer to the English authorities. If anyone asks about the Scottish authorities, I can only refer him to the magnificent speech of my hon. Friend the Member for Glasgow, Central (Mr. McInnes). The Parliamentary Secretary was not here when that speech was made. Had he been, he would have fled. If he studies the English figures and my hon. Friend's analysis of the Scottish situation, the Parliamentary Secretary should emulate some of our more sturdy citizens and set off from John o' Groats to Land's End. He would be met by deputations of councillors and chairmen of finance committees on the way to explain to him the true nature of the rate burden.
A serious and sometimes tragic part of this lies in the fact that even if it were true that the percentage of the cost of services which falls on the rates grew no bigger, as the hon. Member for the City of Chester was arguing, the point is that, unlike the Government, local authorities have limited ways of raising revenue. Consequently, if the total cost of the service grows and the proportion which local authorities have to bear remains stationary, the unfairness of the way they have to raise money bears more and more heavily on the poorer ratepayers. That is not a problem which will be met by fiddling about with inquiring into the exact incomes of people who live in council flats. It is far too large a problem to be tackled in a manner like that, a fact which was strikingly brought out in the speech of the hon. Member for the Isle of Wight.
The burden not only arises from the services themselves, but, as our Motion implies, is aggravated by the fiscal and financial policies of the Government. Let us take the question of loan charges. Every hon. Member who has spoken has given one example after another of the serious burden of loan charges and high interest rates on local authorities. Let the Minister, the Parliamentary Secretary, or any other member of the Government go round to local authorities

and ask about only one of those services, housing, the simple question, "Why is it that your authority is not building more houses than it is building?" I will warrant that the answer which he will get in an enormous number of cases will include an emphatic mention of high interest rates.
There are various ways in which one might try to measure the burden. A local authority gets an income from rates, an income from grants from the Government and some income from loans. Conversely, some of its expenditure is on building houses, some on building schools, and some on loan charges. Let us compare the position nine years ago with that of today. For every £5 which the local authority received as income by the process of borrowing nine years ago, it is now getting £7. That is a measure of the increasing reliance on borrowing. For every £5 which it was having to pay out in loan charges nine years ago, it is having to pay out £12 10s. today. That is a measure of the burden. So long as borrowings increase, total interest burdens must increase, but that increase is quite out of proportion to the amount of money borrowed.
Another matter is the cost of land. We have had plenty of examples of that. Not long ago, my right hon. and learned Friend the Member for Rowley Regis and Tipton (Mr. A. Henderson) gave an example of land the value of which, although the owner had done nothing to it but continue to be the owner, had increased sevenfold in the last few years—"consider the incomes from the field, how they grow; they toil not, neither do they spin. Solomon in all his glory was not as expensive to maintain as these."
We are not now arguing what is the best way for the community to prevent an unjust distribution of wealth. I hope that we shall be able to discuss that on another occasion. All we are saying now is that one facet of this is that it imposes on certain local authorities a shocking burden, and quite arbitrarily according to whether a local authority needs to buy land in certain places and at certain times. It makes a case for more sympathetic consideration by the Government of the need than it has yet received from the Parliamentary Secretary's treatment of the matter.
The other way in which the Government's fiscal policies have added to the burden is our old bone of contention, the block grant. In a debate which we had towards the end of last year, the Minister told me that I was one of a dwindling minority of people who opposed the block grant. I hope that he will pay attention to two speeches from his hon. Friends this afternoon. The hon. Member for the Isle of Wight thought that, in general, the block grant was a splendid thing, but that, unfortunately, it did not work out too well for the Isle of Wight and he would like it altered in this, that or the other respect. The hon. Member for Croydon, North-West had no objections to the block grant in general, but he thought that in its incidence on Croydon it was somewhat unfair and should be altered in another respect.
My hon. Friend the Member for East Ham, South (Mr. Oram) has been unable to speak in this debate, but he has drawn my attention to the fact that a borough like his, with a high standard of services and a declining population, suffers acutely from the operation of the grant. So the Parliamentary Secretary's general invitation to people who suffer from it to make their complaints known to him has already received two answers from his own back benchers and will shortly receive another from East Ham.
The Albemarle Committee—is that one of the dwindling minority?—was interested in the youth service. If one is interested in a service, whatever one's general views about the block grant, one always feels that it ought not to apply to the service in which one is interested oneself. That is what the Albemarle Committee thought.
Unkindest cut of all, the pamphlet on education, "Willingly to School" by the Bow Group, a product of the young Tories—and the Parliamentary Secretary is a member, although by now, perhaps, an ex-member of the Bow Group—shoots this arrow at the Minister, that the block grant
is not satisfactory in such a rapidly expanding service",
that is, education.
Against that background, we have asked for certain action to be taken, the type of action which we regard as what

one might call emergency ambulance action. One is some kind of preferential treatment for local authorities with regard to interest rates. One need not go into the full theory of interest, and its effect on our external and internal economy, to provide certain immediate action to help local authorities. The Parliamentary Secretary asked if we wanted physical controls. My hon. Friend the Member for Widnes pointed out that certain local government services are already subjected to considerable control, and if the Government will say, merely as a first instalment of help, no more than this, that with regard to housing and education—two services over which the central Government exercise considerable control to prevent their getting out of hand and becoming too big a strain on the economy—they are prepared to grant preferential rates of interest to local authorities solely for those two services, we shall be grateful for that mercy to go on with. That does not raise the difficult theoretical questions with which the Parliamentary Secretary tried to surround this matter.
The other emergency ambulance action to be taken is the full rerating of industrial hereditaments. The only approach to a reason that we have had why that should not be done is merely that the rerating up to 50 per cent. is quite recent and that we ought to leave it alone for the time being. If only the Government had taken the advice of our good friend the former Member for Acton, Mr. Joseph Sparks, the whole operation of rerating would have been completed. There is not a single argument in logic left for not carrying through the full rerating of industrial hereditaments.
Our long-term proposal is that there is now a case for a full inquiry into how local authorities are to be enabled to meet what in any case will be a great and growing burden, and is now a burden made heavier by certain specific acts of policy by the Government.
Suggestions have been put forward with regard to local income tax, and special treatment with regard to Stamp Duty has been suggested by the hon. Member for the City of Chester. It has also been suggested that we should look at a local sales tax, and, finally, we have had an interesting,


though rather complicated, proposal by the hon. Member for the Isle of Wight.
It is clear that well-informed people feel that it is time to look at this matter afresh. There are plenty of new ideas. The whole subject is too complicated for these new ideas to be dismissed quickly in the way that the hon. Member for the City of Chester tried to dismiss the rating of site values. It is that situation which creates the case for inquiry, which is the last part of the Motion that we recommend to the House.

6.43 p.m.

The Minister of Housing and Local Government and Minister for Welsh Affairs (Mr. Henry Brooke): Those hon. Members now present in the Chamber who faded to hear the maiden speech of my hon. Friend the Member for the Isle of Wight (Mr. Woodnutt), missed a maiden speech of real distinction, as all those who heard it will agree. He not only spoke persuasively and concisely; he is clearly capable of bringing to our debates a most valuable firsthand knowledge of local government. I will certainly pay attention to the points that he raised.
I should like to assure my hon. Friend and other hon. Members who have criticised the formula for the distribution of the general grant that that formula will be under re-examination in the course of the next few months in consultation with the local authority associations before the general grant is fixed for the period beginning next year.
Fortunately, both sides of the House agree that it is desirable that there should be an expansion of local government services. If there is expansion, it is bound to involve increased cost to the rates, unless the hon. Member for Widnes (Mr. MacColl) desires that all increases should be met as to 100 per cent. by the Exchequer. That must be unsound.
The hon. Member for Southampton, Itchen (Dr. King), in an interesting speech, said that he believes passionately in local government. But there is no future for local government if all additional expenditure that a local authority votes can be reimbursed as to 100 per cent. by the Exchequer.
When I read the interesting account of the Labour Party's Conference on

local government the other day, I half suspected that we might find a Motion like this on the Order Paper, because I realised that rates were going up in a number of local Labour controlled—[HON. MEMBERS: "And others."]—and other local authorities, and I felt sure that the Opposition would seek falsely to insinuate that that was due to the changes in the 1958 Act.

Mrs. Harriet Slater: rose—

Mr. Brooke: I am sorry I cannot give way now, time is short.
The financial and fiscal policies of the Government have nothing to do with these rate increases, where such are being announced, except this, that had the Government not pursued these policies inflation would not have been halted and rates would be increasing very much more rapidly than they are. To keep both central and local government expenditure under control, it is essential that the Government should pursue a wise economic policy to prevent inflation.
Any changes in interest rates consequent on the recent rise in the Bank Rate must be entirely marginal and, I would say, almost infinitesimal in relation to the estimates of rate expenditure for the coming year. As my hon. Friend the Parliamentary Secretary said, they can have no perceptible effect.
The hon. Member for Widnes also urged the full rating of industrial hereditaments. It is important that the House should appreciate the facts. As recently as 1955–56, industry was contributing 4 per cent. of the total rate revenue. At the present time, in the light of the 1958 Act and other developments, industry is contributing 11 per cent., nearly three times as much as it was four years ago. My hon. Friend the Member for Croydon, North-West (Mr. F. Harris) urged, as he was perfectly entitled to do, that industry should be re-rated to 100 per cent. I know that has been his view for a number of years, but I could not follow his argument when he said that the present situation was unfair to householders. Is he suggesting that industry should be re-rated to 100 per cent. while householders should still pay rates on the 1939 value of their property? Quite clearly that would not


put matters on to an even basis of valuation and rating liability as between one class of property and another.
Some hon. Members have suggested the rating of site values. That has been examined by three Commissions or Committees in the present century and been turned down by them all. Hon. Members also suggested the rating of empty properties. That is not really of any material value to the purpose that they have in mind and again that has been rejected on more than one occasion by this House.
Suggestions were made for local income tax. My hon. Friend the Member for the City of Chester (Mr. Temple) pointed out the intolerable difficulties that would arise in deciding whether a person was to be taxed where he lived or where he worked. I take note of my hon. Friend's suggestions about stamp duty on transfers of municipal stocks and the rating of caravans. He may care to know that the rating of caravans is a matter that is being examined by the working party that I have at the present time considering various technical rating questions.
The hon. Member for Widnes spoke of the cost of land. The hon. Member for Southampton, Itchen said that local authorities were being fleeced. What do they mean? Do they mean that local authorities should have power to buy land compulsorily below market value? If so let us know because we are prepared to meet them on that ground. We carried through the 1959 Town and Country Planning Act with I thought the good will of virtually the whole country, and if the Opposition now say that local authorities are being unfairly charged because they are having to pay market value, let me tell them that they will not carry public opinion with them.
I can see no case for a fresh inquiry into the financial relationship between Central and local government. What I do note is that the Opposition Motion does not seek—as they said they were seeking, only a short time ago—the abandonment of the general grant. It would be valuable to the country to know just where the Opposition stand on that matter. If they were returned to power, would they abolish the general grant and go back to percentage grants? They

certainly did not have the courage to say that in their election manifesto.
The Government Amendment, which I trust the House will accept, refers to and welcomes the expansion of local services over the past eight years. If the financial situation of local authorities were as black as it has been made out to be, this expansion would have been impracticable. Some of the figures in this connection are interesting. I should like to quote figures relating to loan sanctions given from year to year. In the last year of the Labour Government, 1950–51, loan sanctions for capital expenditure on highways amounted to £2,750,000; at present they are running at the rate of £14 million a year. In 1950–51, loan sanctions for water and sewerage purposes were running each at the rate of £12 million a year; now they are about £27 million for water and about £40 million for sewerage a year. This is an expansion which local authorities are carrying out, and they are not being rendered bankrupt in doing so.
The Government Amendment further endorses the change from percentage grants to a system of general grants. I believe that, whatever party is in power in years to come, we shall never go back to the dangerous system of percentage grants, which we largely got rid of in 1958. The general grant gives greater independence to local authorities, because they do not need to be so strictly controlled at every point in their spending, and it puts a higher degree of responsibility upon local councillors in determining how to allocate their available revenue to the different services.
I thought that my hon. Friend the Member for the Isle of Wight pointed out the danger of the old system very admirably when he mentioned the temptation which existed, in former days, to say, "Let us go ahead with the scheme, because somebody else will pay 60 per cent. of the cost." That cannot lead to efficient and economic administration. Under the general grant system, if the council can save money by increasing the efficiency of its administration the whole of any financial benefit accrues to its own ratepayers. The incentive to better administration is as strong as could be.
The hon. Member for Widnes said that suspected that the Government did not want local authorities to have greater financial resources. That remark is strangely out of keeping with what has been happening. In England and Wales, in the last year of the Labour Government the amount of Central Government grant was just about equal to the amount raised by local authorities in rates. Let us compare that with the situation today. In the current year Exchequer grants to local authorities are 11 per cent. higher than the rate revenue of the authorities, even though rateable capacity has been increased in the meantime through industrial re-rating to 50 per cent. I see no prospect of a trend the other way in 1960–61, but we need to watch these matters carefully.
The hon. Member for Glasgow, Central (Mr. McInnes) said that I would not know anything about Scotland, but I know that he was quoting only the increase in rates. He never mentioned that whereas in 1950–51 Exchequer grants were 24 per cent. higher than the rate revenues in Scotland, in the current year they are 40 per cent. higher. This does not seem to be a case of Central Government starving local services in England, Wales or Scotland.
In fact, as the Vote on Account which we were dealing with earlier shows, in respect of England and Wales this year we are voting a £79 million increase in Exchequer grants to local authorities. Whereas it has been insinuated that local authorities are sufferers through the 1958 Act, in fact that Act was framed so as to ensure that they would gain £10 million a year from its operation—and not just £10 million in the first year, but a continuing £10 million a year. So far as I can judge, the gain to local authorities in 1960–61, compared with what they would have had if the 1958 Act had not been passed is more likely to be £15 million than £10 million, yet it seems that the Opposition would not

mind throwing that gain away and putting local authorities back in their former position.

It was suggested that we were complacent and were not taking local feeling into account. The Municipal Journal is not a Central Government organ; it is written by local authority people for local authority people. In its issue of 19th February it said:
Following up Mr. Henry Brooke's policy of giving more responsibility to councils it is reassuring to note that Government grants to local authorities are up by £60 million for the coming year. Some of the increase reflects the attempt to meet recent overall rises in education costs, but there remains a substantial improvement in transferable sums. For the present at least those who have been sceptical at the replacement of specific grants by one general grant should find some reassurance in the Civil Estimates.
The Government Amendment says that the House should approve the principle of giving the most help to authorities in the greatest need. That is embodied in the system of rate deficiency grants. Under the former Measure, passed by the Labour Government, a poor district in a rich county got no assistance, whereas a rich district in a poor county did. We have altered that, and the rate deficiency grant now gives help where help is most needed.

The hon. Member for Widnes, in one of his more flowery passages, charged me with ecstatic contemplation of the general and overlooking the poignant realities of the particular. I suggest that, poignant or not, he should not have overlooked the realities in his own borough of Widnes, which has gained the equivalent of a 2s. 1d. rate through the 1958 Act. If I were he I should be more inclined to study the interests of my constituents than to follow too strictly the party line.

Question put, That the words proposed to be left out stand part of the Question:—

The House divided: Ayes 236, Noes 298.

Division No. 44.]
AYES
[6.59 p.m.


Abse, Leo
Beaney, Alan
Bowen, Roderic (Cardigan)


Ainsley, William
Bellenger, Rt. Hon. F. J.
Bowles, Frank


Albu, Austen
Bence, Cyril (Dunbartonshire, E.)
Braddock, Mrs. E. M.


Allaun, Frank (Salford, E.)
Benn, Hn. A. Wedgwood (Brist'l, S. E.)
Broughton, Dr. A. D. D.


Allen, Scholefield (Crewe)
Benson, Sir George
Brown, Alan (Tottenham)


Awbery, Stan
Blackburn, F.
Brown, Rt. Hon. George (Belper)


Bacon, Miss Alice
Blyton, William
Brown Thomas (Ince)


Baird, John
Boardman H.
Butler, Herbert (Hackney, C.)


Baxter, William (Stirlingshire, W.)
Bowden, Herbert W. (Leics. S. W.)
Callaghan, James




Carmichael, James
Irving, Sydney (Dartford)
Rankin, John


Castle, Mrs. Barbara
Janner, Barnett
Reid, William


Chapman, Donald
Jay, Rt. Hon. Douglas
Reynolds G. W.


Chetwynd, George
Jeger, George
Rhodes, H.


Cliffe, Michael
Jenkins, Roy (Stechford)
Robens, Rt. Hon. Alfred


Collick, Percy
Johnson, Carol (Lewisham, S.)
Roberts, Albert (Normanton)


Corbet, Mrs. Freda
Jones, Rt. Hn. A. Creech (Wakefield)
Roberts, Goronwy (Caernarvon)


Craddock, George (Bradford, S.)
Jones, Dan (Burnley)
Robinson, Kenneth (St. Pancras, N.)


Cronin, John
Jones, Elwyn (West Ham, S.)
Rogers, G. H. R. (Kensington, N.)


Crosland, Anthony
Jones, Jack (Rotherham)
Ross, William


Crossman, R. H. S.
Jones, J. Idwal (Wrexham)
Royle, Charles (Salford, West)


Cullen, Mrs. Alice
Jones, T. W. (Merioneth)
Shinwell, Rt. Hon. E.


Darling, George
Kenyon, Clifford
Short, Edward


Davies, Rt. Hn. Clement (Montgomery)
Key, Rt. Hon. C. W.
Silverman, Julius (Aston)


Davies, G. Elfed (Rhondda, E.)
King, Dr. Horace
Silverman, Sydney (Nelson)


Davies, Harold (Leek)
Lawson, George
Skeffington Arthur


Davies, Ifor (Gower)
Lee, Frederick (Newton)
Slater, Mrs. Harriet (Stoke, N.)


Davies, S. O. (Merthyr)
Lee, Miss Jennie (Cannock)
Slater, Joseph (Sedgefield)


Deer, George
Lever, Harold (Cheetham)
Small, William


de Freitas, Geoffrey
Lever, L. M. (Ardwick)
Smith, Ellis (Stoke, S.)


Delargy, Hugh
Lewis, Arthur (West Ham N.)
Snow, Julian


Dempsey, James
Lipton, Marcus
Sorensen, R. W.


Diamond, John
Loughlin, Charles
Soskice, Rt. Hon. Sir Frank


Dodds, Norman
Mabon, Dr. J. Dickson
Spriggs, Lesile


Donnelly, Desmond
McCann, John
Stewart, Michael (Fulham)


Driberg, Tom
MacColl, James
Stonehouse, John


Dugdale, Rt. Hon. John
McInnes, James
Stones, William


Ede, Rt. Hon. Chuter
McKay, John (Wallsend)
Strachey, Rt. Hon. John


Edelman, Maurice
McLeavy, Frank
Strauss, Rt. Hn. G. R. (Vauxhall)


Edwards, Rt. Hon. Ness (Caerphilly)
MacMillan, Malcolm (Western Isles)
Stross, Dr. Barnett (Stoke-on-Trent, C.)


Edwards, Robert (Bilston)
MacPherson, Malcolm (Stirling)
Swain, Thomas


Edwards, Walter (Stepney)
Mahon, Simon
Swingler, Stephen


Evans, Albert
Mallalieu, E. L. (Brigg)
Sylvester, George


Finch, Harold
Mallalieu, J. P. W. (Huddersfield, E.)
Taylor, Bernard (Mansfield)


Fitch, Alan
Manuel, A. C.
Thomas, George (Cardiff, W.)


Fletcher, Eric
Mapp, Charles
Thomas, Iorwerth (Rhondda, W.)


Foot, Dingle
Marquand, Rt. Hon. H. A.
Thompson, Dr. Alan (Dunfermline)


Forman, J. C.
Marsh, Richard
Thomson, G. M. (Dundee, E.)


Fraser, Thomas (Hamilton)
Mason, Roy
Thornton, Ernest


Gaitskell, Rt. Hon. Hugh
Mellish, R. J.
Timmons, John


George, Lady Megan Lloyd
Mendelson, J. J.
Tomney, Frank


Ginsburg, David
Millan, Bruce
Ungoed-Thomas, Sir Lynn


Gooch, E. G.
Mitchison, G. R.
Wade, Donald


Gordon Walker, Rt. Hon. P. C.
Monslow, Walter
Wainwright, Edwin


Gourlay, Harry
Moody, A. S.
Warbey, William


Greenwood, Anthony
Moyle, Arthur
Watkins, Tudor


Grey, Charles
Mulley, Frederick
Weitzman, David


Griffiths, David (Rother Valley)
Neal, Harold
Wells, Percy (Faversham)


Griffiths, Rt. Hon. James (Llanelly)
Noel-Baker, Francis (Swindon)
Wells, William (Walsall, N.)


Grimond, J.
Noel-Baker, Rt. Hn. Philip (Derby, S.)
Wheeldon W. E.


Gunter, Ray
Oliver, G. H.
White, Mrs. Eirene


Hale, Leslie (Oldham, W.)
Oram, A. E.
Whitlock, William


Hall, Rt. Hn. Glenvil (Colne Valley)
Oswald, Thomas
Wigg, George


Hamilton, William (West Fife)
Owen, Will
Wilcock, Group Capt. C. A. B.


Hart, Mrs. Judith
Padley, W. E.
Wilkins, W. A.


Hayman, F. H.
Pannell, Charles (Leeds, W.)
Willey, Frederick


Healey, Denis
Parker, John (Dagenham)
Williams, D. J. (Neath)


Henderson, Rt. Hn. Arthur (Rwly Regis)
Parkin, B. T. (Paddington, N.)
Williams, Rev. Ll. (Abertillery)


Herbison, Miss Margaret
Paton, John
Williams, W. R. (Openshaw)


Hilton, A. V.
Pavitt, Laurence
Willis, E. G. (Edinburgh, E.)


Holman, Percy
Pearson, Arthur (Pontypridd)
Wilson, Rt. Hon. Harold (Huyton)


Holt, Arthur
Peart, Frederick
Winterbottom, R. E.


Houghton, Douglas
Pentland, Norman
Woodburn, Rt. Hon. A.


Howell, Charles A.
Plummer, Sir Leslie
Woof, Robert


Hoy, James H.
Popplewell, Ernest
Wyatt, Woodrow


Hughes, Cledwyn (Anglesey)
Prentice, R. E.
Yates, Victor (Ladywood)


Hughes, Emrys (S. Ayrshire)
Price, J. T. (Westhoughton)
Zilliacus, K.


Hunter, A. E.
Probert, Arthur



Hynd, H. (Accrington)
Proctor, W. T.
TELLERS FOR THE AYES:


Hynd, John (Attercliffe)
Pursey, Cmdr. Harry
Mr. J. Taylor and Mr. Redhead.


Irvine, A. J. (Edge Hill)
Randall, Harry





NOES


Agnew, Sir Peter
Barlow, Sir John
Biggs-Davison, John


Aitken, W. T.
Barter, John
Birch, Rt. Hon. Nigel


Allan, Robert (Paddington, S.)
Batsford, Brian
Bishop, F. P.


Allason, James
Baxter, Sir Beverley (Southgate)
Black, Sir Cyril


Alport, C. J. M.
Beamish, Col. Tufton
Bossom, Clive


Amory, Rt. Hn. D. Heathcoat (Tiv'tn)
Bell, Philip (Bolton E.)
Bourne-Arton, A.


Arbuthnot, John
Bell, Ronald (S. Bucks.)
Box, Donald


Ashton, Sir Hubert
Bennett, F. M. (Torquay)
Boyd-Carpenter, Rt. Hon. John


Atkins, Humphrey
Bennett, Dr. Reginald (Gos &amp; Fhm)
Boyle, Sir Edward


Balniel, Lord
Berkeley, Humphry
Braine, Bernard


Barber, Anthony
Bevins, Rt. Hon. Reginald (Toxteth)
Brewis, John







Brooke, Rt. Hon. Henry
Hinchingbrooke, Viscount
Orr, Capt. L. P. S.


Brooman-White, R.
Hobson, John
Orr-Ewing, C. Ian


Bryan, Paul
Hocking, Philip N.
Osborn, John (Hallam)


Bullard, Denys
Holland, Philip
Page, Graham


Bullus, Wing Commander Eric
Hope, Rt. Hon. Lord John
Pannell, Norman (Kirkdale)


Burden, F. A.
Hopkins, Alan
Partridge, E.


Butcher, Sir Herbert
Hornby, R. P.
Pearson, Frank (Clitheroe)


Butler, Rt. Hn. R. A. (Saffron Walden)
Hornsby-Smith, Rt. Hon. Patricia
Peel, John


Campbell, Sir David (Belfast, S.)
Howard, Gerald (Cambridgeshire)
Percival, Ian


Carr, Compton (Barons Court)
Howard, Hon. G. R. (St. Ives)
Peyton, John


Carr, Robert (Mitcham)
Howard, John (Southampton, Test)
Pickthorn, Sir Kenneth


Channon, H. P. G.
Hughes Hallett, Vice-Admiral John
Pike, Miss Mervyn


Chichester-Clark, R.
Hughes-Young, Michael
Pilkington, Capt. Richard


Clark, Henry (Antrim, N.)
Hulbert, Sir Norman
Pitman, I. J.


Clark, William (Nottingham S.)
Hurd, Sir Anthony
Pitt, Miss Edith


Clarke, Brig. Terence (Portsmth, W.)
Hutchison, Michael Clark
Pott, Percivall


Cleaver, Leonard
Iremonger, T. L.
Powell, J. Enoch


Cole, Norman
Irvine, Bryant Godman (Rye)
Price, David (Eastleigh)


Collard, Richard
Jackson, John
Prior-Palmer, Brig. Sir Otho


Cooke, Robert
James, David
Proudfoot, Wilfred


Cooper, A. E.
Jenkins, Robert (Dulwich)
Ramsden, James


Cordeaux, Lt.-Col. J. K.
Jennings, J. C.
Redmayne, Rt. Hon. Martin


Cordle, John
Johnson, Dr. Donald (Carlisle)
Rees, Hugh


Corfield, F. V.
Johnson, Eric (Blackley)
Ridley, Hon. Nicholas


Costain, A. P.
Johnson Smith, Geoffrey
Ridsdale, Julian


Coulson, J. M.
Jones, Rt. Hn. Aubrey (Hall Green)
Rippon, Geoffrey


Courtney, Cdr. Anthony
Joseph, Sir Keith
Robertson, Sir David


Craddook, Beresford (Spelthorne)
Kaberry, Sir Donald
Robson Brown, Sir William


Critchley, Julian
Kerans, Cdr. J. S.
Rodgers, John (Sevenoaks)


Crowder, F. P.
Kerby, Capt. Henry
Roots, William


Currie, G. B. H.
Kerr, Sir Hamilton
Ropner, Col. Sir Leonard


d'Avigdor-Goldsmid, Sir Henry
Kershaw, Anthony
Royle, Anthony (Richmond, Surrey)


Deedes, W. F.
Kirk, Peter
Russell, Ronald


de Ferranti, Basil
Kitson, Timothy
Sandys, Rt. Hon. Duncan


Digby, Simon Wingfield
Lambton, Viscount
Scott-Hopkins, James


Donaldson, Cmdr. C. E. M.
Lancaster, Col. C. G.
Seymour, Leslie


Doughty, Charles
Langford-Holt, J.
Sharples, Richard


Drayson, G. B.
Leavey, J. A.
Shepherd, William


Duncan, Sir James
Leburn, Gilmour
Simon, Sir Jocelyn


Eccles, Rt. Hon. Sir David
Legge-Bourke, Maj. H.
Skeet, T. H. H.


Eden, John
Lewis, Kenneth (Rutland)
Smith, Dudley (Br'ntf'd &amp; Chiswick)


Elliott, R. W.
Lilley, F. J. P.
Smithers, Peter


Emery, Peter
Lindsay, Martin
Smyth, Brig. Sir John (Norwood)


Emmet, Hon. Mrs. Evelyn
Linstead, Sir Hugh
Soames, Rt. Hon. Christopher


Errington, Sir Eric
Litchfield, Capt. John
Spearman, Sir Alexander


Erroll, F. J.
Longden, Gilbert
Speir, Rupert


Farey-Jones, F. W.
Loveys, Walter H.
Stanley, Hon. Richard


Farr, John
Low, Rt. Hon. Sir Toby
Steward, Harold (Stockport, S.)


Finlay, Graeme
Lucas-Tooth, Sir Hugh
Stoddart-Scott, Col. Sir Malcolm


Fletcher-Cooke, Charles
McAdden, Stephen
Storey, Sir Samuel


Foster, John
MacArthur, Ian
Studholme, Sir Henry


Fraser, Hn. Hugh (Stafford &amp; Stone)
McLaren, Martin
Sumner, Donald (Orpington)


Freeth, Denzil
McLaughlin, Mrs. Patricia
Talbot, John E.


Gammans Lady
Maclay, Rt. Hon. John
Tapsell, Peter


Gardner, Edward
Maclean, Sir Fitzroy (Bute &amp; N. Ayrs.)
Taylor, Sir Charles (Eastbourne)


George, J. C. (Pollok)
McLean, Neil (Inverness)
Taylor, W. J. (Bradford, N.)


Gibson-Watt, David
Macleod, Rt. Hn. Iain (Enfield, W.)
Teeling, William


Glyn, Dr. Alan (Clapham)
MacLeod, John (Ross &amp; Cromarty)
Temple, John M.


Glyn, Col. Richard H. (Dorset, N.)
McMaster, Stanley
Thatcher, Mrs. Margaret


Godber, J. B.
Macmillan, Rt. Hn. Harold (Bromley)
Thomas, Leslie (Canterbury)


Goodhart, Philip
Macmillan, Maurice (Halifax)
Thomas, Peter (Conway)


Goodhew, Victor
Macpherson, Niall (Dumfries)
Thompson, Richard (Croydon, S.)


Gower, Raymond
Madden, Martin
Thornton-Kemsley, Sir Colin


Grant, Rt. Hon. William (Woodside)
Maginnis, John E.
Tilney, John (Wavertree)


Grant-Ferris, Wg Cdr. R. (Nantwich)
Maitland, Cdr. J. W.
Turner, Colin


Green, Alan
Manningham-Buller, Rt. Hn. Sir R.
Turton, Rt. Hon. R. H.


Gresham Cooke, R.
Marlowe, Anthony
Tweedsmuir, Lady


Grosvenor, Lt.-Col. R. G.
Marples, Rt. Hon. Ernest
van Straubenzee, W. R.


Hall, John (Wycombe)
Marshall, Douglas
Vane, W. M. F.


Hamilton, Michael (Weillngborough)
Marten, Neil
Vaughan-Morgan, Sir John


Hare, Rt. Hon. John
Mathew, Robert (Honiton)
Vickers, Miss Joan


Harris, Frederic (Croydon, N. W.)
Matthews, Gordon (Meriden)
Vosper, Rt. Hon. Dennis


Harris, Reader (Heston)
Maudling, Rt. Hon. Reginald
Walker-Smith, Rt. Hon. Derek


Harrison, Brian (Maldon)
Mawby, Ray
Wall, Patrick


Harrison, Col. J. H. (Eye)
Maydon, Lt.-Cmdr. S. L. C.
Ward, Rt. Hon. George (Worcester)


Harvey, Sir Arthur Vere (Macclesf'd)
Milligan, Rt. Hon. W. R.
Ward, Dame Irene (Tynemouth)


Harvey, John (Walthamstow, E.)
Mills, Stratton
Watkinson, Rt. Hon. Harold


Harvie Anderson, Miss
Moore, Sir Thomas
Watts, James


Hay, John
Morgan, William
Webster, David


Heath, Rt. Hon. Edward
Morrison, John
Wells, John (Maidstone)


Henderson, John (Cathcart)
Mott-Radclyffe, Sir Charles
Whitelaw, William


Hendry, Forbes
Heave, Airey
Williams, Dudley (Exeter)


Hicks Beach, Maj. W.
Nicholson, Sir Godfrey
Williams, Paul (Sunderland, S.)


Hiley, Joseph
Noble, Michael
Wills, Sir Gerald (Bridgwater)


Hill, Dr. Rt. Hon. Charles (Luton)
Nugent, Sir Richard
Wilson, Geoffrey (Truro)


Hilt, J. E. B. (S. Norfolk)
Ormsby-Gore, Rt. Hon. D.
Wise, A. R.







Wolrige-Gordon, Patrick
Woodnutt, Mark
Yates, William (The Wrekin)


Wood, Rt. Hon. Richard
Woollam, John



Woodhouse, C. M.
Worsley, Marcus
TELLERS FOR THE NOES:




Mr. Legh and Mr. E. Wakefield.

It being after Seven o'clock, and there being Private Business set down by direction of The CHAIRMAN OF WAYS AND MEANS under Standing Order No. 7 (Time for taking Private Business), further Proceeding stood postponed.

Orders of the Day — BRISTOL CORPORATION BILL (By Order)

Order for Second Reading read.

Motion made, and Question proposed, That the Bill be now read a Second time.

7.10 p.m.

Mr. W. A. Wilkins: You will recall, Mr. Speaker, that when this Bill has been called upon other occasions it has been objected to. I must, therefore, conclude that there are hon. Members who require some more detailed explanations of its provisions. Quite frankly, I have read the Bill over and over again and I am completely at a loss to understand why there should be any objection to the provisions it seeks, especially as we are proposing that in Committee—if the Bill is sent to Committee—there shall be an application for withdrawal of some of the Clauses to meet the wishes of a town's meeting in the city which required that those Clauses should be be withdrawn.
It may be that objection has been taken to the Bill on what one might call a matter of principle—that this House must always remain the guardian of the people's purse and that in pursuance of that responsibility it insists on an opportunity to discuss the purposes of the Bill on Second Reading. If that be the case, I certainly have no objection and I should not complain. Bristol Corporation has nothing to hide from the public or from this House in the proposals that it seeks to incorporate in the Bill. It is seeking to obtain nothing through the medium of legislation in this House by what one might call back-door methods.
This is a perfectly straightforward, general powers or enabling Bill which seeks powers believed to be in the best interests of the public in our city, and especially to make provision for the speedier flow of our internal traffic. Incidentally, that could go a considerable

way towards easing the terrific traffic problem which confronts road users in the peak holiday period on their way to West Country resorts. That, as I say, is an incidental consideration.
There is really only one major proposal. Other Clauses have been inserted because, as members of local authorities who are hon. Members of the House will know, when a corporation is to promote a Bill and has spent money on its promotion it seeks to find from its various departments whether there are any other matters which should be incorporated and other powers which should be sought. So there are Clauses in the Bill which arise as a result of requirements other than the main proposals in the Bill. Because hon. Members may have interests in some parts of the Bill, it might be convenient if I say that, if it reaches Committee stage, we are proposing to seek the withdrawal in entirety of the Clauses in Part IV. We shall also seek to withdraw Clauses 39 and 57.
The main proposal, the most important and major proposition in character, is the construction of two new bridges over the River Avon and Cumberland Basin. Those bridges are to be part of a large highway improvement scheme for this area of our city which will also include the building of an elaborate underpass and flyover system. I do not believe that anyone in the City of Bristol does not recognise the need for this, or that anyone would object to the proposed improvement being effected.
I also call attention to the reasons why we have to apply for this Parliamentary permission. Since these new bridges will cross navigable waterways, it is necessary for the Corporation to obtain specific powers to construct them. Those powers, together with powers to construct certain subsidiary works, are contained in Clauses 15 to 19 of the Bill. I shall briefly explain the present position. Cumberland Basin is the entrance to our important city docks. The River Avon, as many hon. Members know, is a tidal river. The water is locked in so that the dockised part of the river can be used at all times for discharging and loading.
This also means that at all tides a considerable volume of shipping passes in and out of our docks. At present, in this area where it is proposed to construct these new bridges there is only one swing bridge. That bridge is over the basin and carries most of the road traffic entering and leaving the city from the North, the West and the South, and also quite a formidable part of the internal city traffic. When that bridge is opened all this traffic is halted and soon there is a huge build-up of traffic over a wide area. As hon. Members may know, because probably they have passed through our city on their way to the South and West Coasts, in the summer months this often leads to an utterly chaotic situation.
If the House allows the Bill to go forward—as I trust it will—and it becomes an Act, the new bridges with the flyover and the underpass will ensure that the flow of traffic will never cease, for, when one of the bridges is open, the other will be closed. By the use of the flyover and underpass we shall always be able to move traffic in and out of the city, irrespective of the use of the basin by ships leaving our docks to get to the open sea.
Clause 22 would permit the stopping up of those portions of the highways which are required for the purposes of constructing the approaches to the new bridges. I ask the House to note this. If hon. Members read the Bill carefully, they will find that none of this stopping up will be permitted until the Minister of Transport is satisfied that adequate alternative highways have been constructed and are in fact open for public use.
I refer again to Part II of the Bill, which is the part which relates to the acquisition of lands required for the purposes I have briefly outlined. The only land for which powers of compulsory acquisition are sought are five pieces of land owned by the British Transport Commission. They are required for the approaches and the bridges and a compulsory easement is also required for carrying a highway over the railway at one point. The British Transport Commission does not object to this in principle. We confidently believe that the matters of detail which will have to be settled will be agreed between both

parties without, we hope, even having to trouble a Select Committee.
I shall say a word about Part V of the Bill. I am dealing only briefly with the Bill and trying to assess the Clauses which may call for some observation or some objection by hon. Members who may be interested in its provisions. Clause 33 provides that persons shall give the Corporation not less than 14 days' notice of its intention to install oil-burning equipment in any building to which the Clause applies, that is, any building other than a private dwelling-house. The Clause will also permit the Corporation to make byelaws to secure that oil-burning equipment is properly installed and that adequate fire protection and fire fighting appliances are provided. The byelaws will, of course, require confirmation by the Secretary of State.
I emphasise to the House that this Clause does not operate so as to prevent the installation of oil-burning equipment without the consent of the Corporation. It is designed merely to provide a maximum code of public safety. There are other Clauses which relate to some control being accorded to the Corporation over the storage of inflammable liquids, such as paraffin oil, which may be stored on the premises of a hardware shop, or petrol which, unless properly stored, would constitute a public risk and perhaps public danger.
I emphasise particularly to the Parliamentary Secretary that in asking for powers of registration of these shops we are thinking in terms of premises which store more than 50 gallons. Speaking entirely personally, I would have thought that 50 gallons of paraffin or any other inflammable liquid was quite a dangerous fire risk. We are suggesting that the registration should be of premises which store more than 50 gallons. Our only purpose in asking for registration is that we shall know where these liquids are stored and be able to convey that information to the fire fighting service, so that should a fire break out on those premises it would be possible for the fire brigade to anticipate the risk which they would have to face.
I believe that there is a probability of the Government bringing in legislation which would be applied nationally and which would seek to effect some of the controls which we have put forward,


although perhaps not in the same language as the Bill. If that is so, we should be completely happy, because we do not want to ask Parliament to give us any powers which would be a duplication of anything which might be provided by national legislation. We ask only for this power if it is not available to us through any Act of Parliament at present on the Statute Book or likely to be on the Statute Book in the near future.
I know that there is concern on the part of the Government about the proposals of Part IV of the Bill which relate to finance and superannuation. We are asking for a Clause which, I understand, is similar to that which has been obtained by a number of other local authorities in recent sessions of Parliament. In other words, we seek to extend the range of securities in which moneys forming part of the Corporation's superannuation fund are to be invested.
I understand that the Treasury is at the moment considering what, if any, modifications to the Clause are necessary following the publication of the White Paper. I am advised that I may give to the Parliamentary Secretary an assurance that we shall seek to withdraw Clause 39, since the Minister of Transport wishes the matter to be dealt with by a new pilotage byelaw. Similarly, if the Treasury is proposing any alteration which would meet the proposals in the Bill, we should be very happy also to withdraw Clause 38.
I should like to refer to one matter which is in a sense unique or, at least, something which I believe to be without precedent. I feel that there are occasions when it is wise to re-establish precedents. Clause 34 is a proposal perhaps to establish a precedent and the Bristol City Council attaches much importance to it. For several years we have been carrying out in the city a scheme, which got under way before the war and which had to be abandoned on account of the war, for a huge main drainage and storm water sewer project. It is costing the city many millions of pounds.
The scheme is aimed ultimately at securing that practically the whole of the city will be free from flooding. Even when I was a very small boy—and that is a few years ago—there was a road near where I lived where there was

flooding every time we had a thunderstorm, even if the storm were not of great magnitude; the water flooded back through the houses, bringing sewage and many other things.
This went on for many years. Steps were taken by the local authority to alleviate the position, but ultimately, with the enormous growth in housing in the inter-war years and subsequently, the storm-water sewer and the main sewerage system has become almost incapable of carrying this water away, and in recent years we have been subject to a considerable amount of flooding. We shall not be able to provide for extremely abnormal rainfall, but we think that the worst of these conditions will disappear when the storm-water sewer is operating.
The Corporation has on many occasions found itself almost powerless to give to citizens the assistance which it would like to give at these times. We have done as much as we have been able to do, but we are proposing that we may be granted the authority to set up a fund of about £10,000 which we can use for alleviating general distress when flooding occurs in the city. I hope that the House will give very sympathetic consideration to Clause 44, which makes this provision. I know that the Parliamentary Secretary is somewhat concerned about it, but I suggest to him that his concern should not go beyond the point of saying something about it in Committee, and possibly modifying it if he thinks it ought to be modified or having a further explanation of it in due course.
There is much more in the Bill, but I leave it there. I hope that the House will give it a Second Reading, for I believe that there is nothing in the Bill which is adverse to the public interest in our city or, for that matter, the interest of anyone else who may be concerned.

7.33 p.m.

Major W. Hicks Beach: I congratulate the hon. Member for Bristol, South (Mr. Wilkins) on having given us a very clear explanation of the Bill. I am on record as having said on past occasions that when Bills of a complicated nature are presented an hon. Member ought to explain them to the House. I therefore take this opportunity of thanking him for his very clear explanation.
There is one point only which I should like to put to him. I thought I understood him to say that the whole of Part IV of the Bill, which contains some Clauses to which I personally object, is to be withdrawn. Is that correct?
I congratulate him on having presented the Bill very clearly, as my view is that such Bills should always be clearly explained.

Mr. Wilkins: I can give the hon. Member an assurance that if the Bill is sent to Committee, leave will be sought to withdraw Part IV.

7.34 p.m.

Mr. Robert Cooke: I should like to add my congratulations to those already offered to the hon. Member for Bristol, South (Mr. Wilkins) on the explanation which he has given to the House, including the lengthy explanation which he gave of the geography of my constituency. The Bill, in effect, is about Bristol, West, with other things tacked on to it. I am grateful to him for having explained that part of the Bill so that I need not go over it again.

Mr. Wilkins: I would remind the hon. Member that the two bridges will connect his constituency with mine. It may therefore be to enable us to go the other way!

Mr. Cooke: I have my doubts about that. Nevertheless, I congratulate the hon. Member on the explanation which he has given.
He said that the Parliamentary Secretary would have an opportunity to speak on the Bill in Committee, but as far as I know the Committee stage will be taken by a small Committee upstairs and the Parliamentary Secretary will not speak there. Indeed, no Bristol Member will take part in that debate. That is why I feel that it is valuable that we should have this short discussion today.
I do not oppose the Bill, but the House should know that the Bill is acceptable to it, I hope, because of a victory of the democratic processes over the forces of bureaucracy. When it was thought necessary to introduce the bridge scheme—which is a necessary scheme and is the main point of the Bill—it was thought fit in the Bristol

Corporation to go round all the committees and departments to see what they would like to stick into the Bill. A whole lot of very unacceptable proposals were put forward. Some of them were taken out in the corporation committee, some were taken out by vote in the full council and some were taken out at a town meeting.
That is a point on which I should like to comment briefly, in passing, because there are people who say that town meetings should be abolished. We should not have had the very salutary effect of some of the objectionable parts of the Bill being taken out if we had not had a town meeting in Bristol. I hope that this sort of democratic process will never be abolished.
I welcome the road scheme, which is the main provision of the Bill, but carrying out a great scheme like this is bound to upset quite a number of people. In this case all those people are constituents of mine. The case has been made in presenting the Bill that the powers sought in the Bill will not involve the purchase of any house property or the disturbance of any people, but by the very nature of the bridge scheme many people will be disturbed. They are all constituents of mine, many of them having lived in this historic area of the water front for many years. The whole character of that part of Bristol is to be changed by the great road scheme.
I here ask for the Corporation of Bristol to make a public declaration between now and Third Reading that it will make every effort in its power to accommodate in that area the people who will be disturbed by the bridge scheme. I ask the Corporation to make a public declaration of that intention. I give the Corporation, between now and Third Reading, the opportunity to make that declaration in a satisfactory form, otherwise I shall oppose the Third Reading of the Bill. I feel very strongly that the interests of my constituents may not otherwise be safeguarded in the way that I wish them to be safeguarded.
The remainder of the Bill contains a number of miscellaneous matters. Some of them deal with fire precautions. Some are good, but many people in the world of commerce feel that some are somewhat restrictive, and they will no


doubt have something to say when they appear before the Committee later, because they can be represented there.
I welcome the scheme for flood relief. In the past we have not been able to do as much about this as we should have liked to do. I particularly welcome the idea that the City Art Gallery should be allowed to accumulate its fund from one year to another so that at one point it may have enough money in the fund to buy one good picture. Thanks to the Wills family, we are fairly well off, because that family has given large sums of money, but that will not go on for ever, and this is a very sensible provision.
I welcome the scheme by which a special part of certain public parks can be reserved for aged people where they will be undisturbed by the perhaps more riotous performance of the younger generation, and even of people like myself. I also note that it is necessary in Clause 58 to include the power of entry into places where public meetings are to take place, That should have been in the Bill of 1950 but was left out. This shows that these Bills can sometimes slip through in an improper form.
Many of these small matters would not have to be brought before the House in a Private Bill at all if the Government would introduce a Local Government (General Powers) Bill. Such a Bill is badly needed. We could save much of the House's time by giving all these necessary small powers to local authorities. They could all be properly discussed, and we could ensure that no unreasonable powers were given, if the House passed a General Powers Bill for all local authorities.
Although I do not oppose the Bill, there are some powers in it which could be abused if there were a domineering local authority, as we have had in Bristol in recent years. However, it is now tempered by the fact that the Socialist Party has a majority of only one. It is all right now that we have a fair balance. No doubt the Conservatives will have power next year. If there were a domineering local authority, some of the powers could be abused, and for that reason I have misgivings about the Bill.
I am very grateful to the hon. Member for Bristol, South for explaining the Bill and giving me the opportunity to make

these remarks, because I feel that these things must be said. Indeed, I am one of those people who feel that no legislation should go through either House without being properly discussed.

7.41 p.m.

Mr. Stan Awbery: The hon. Member for Bristol, West (Mr. Robert Cooke) has given qualified approval to the Bill. I should have preferred it if he had objected to it and stated his objection frankly to the House. He has endeavoured to introduce party politics into a Bill of this character. He has told us what has been happening in Bristol, which has been governed by a Labour council for a number of years. The Bill has been prepared with the approval of a council elected by the people of Bristol. It has been sent to the House because Bristol has not the power to carry out the necessary works. I thought that it was a non-contentious Bill. When it came before the House objection was taken on two or three occasions, but I understand that that objection has now been withdrawn and the Bill is not to be opposed at any time.

Mr. Robert Cooke: The only means by which we could possibly have a Second Reading debate on the Bill was for technical objection to be taken every time the Bill was called. That is why the Bill was objected to. At least, that is my information.

Mr. Awbery: I am merely saying that objection was taken to the Bill, but that objection has now been withdrawn and the Bill comes before the House. I thought that it would have the full approval of everyone, particularly hon. Members representing Bristol, the city which sent the Bill to the House for approval.
I thank my hon. Friend the Member for Bristol, South (Mr. Wilkins) for giving us a detailed explanation of the Clauses in the Bill. Most of them have precedents in other local authority Bills. There is nothing new about them. The powers for which Bristol asks are in most cases exercised by other local authorities. Other authorities have brought their Private Bills before the House of Commons, and in most cases the powers being asked for by the Bristol City Council have been included in those


Bills. The objections which were raised in the early stages have been amicably settled between the parties concerned. No doubt they sat around a table, discussed the problems and removed the grievances. This is a clear indication that negotiation around a table is good machinery by which to settle differences. I understand that there is now no opposition.
The main theme of the Bill, its chief object, is to give the authority in Bristol powers to construct the two bridges and the approaches to them stated by my hon. Friend the Member for Bristol, South. They may come partly in Bristol, West; they may come in Bristol, Central; but this is a Bristol scheme—not a Bristol, West scheme, nor a Bristol, Central scheme, nor a Bristol, South scheme. The Bristol people think that the work which is to be carried out is necessary. The Corporation has to come to Parliament and ask for powers to carry out the scheme, because it does not already possess them. That is why the Bill is here.

Lieut.-Commander S. L. C. Maydon: Will the hon. Gentleman tell me how I can reach Bristol from my constituency and from my home if these bridges are demolished? Will there be alternative access over the Cumberland Basin from the west?

Mr. Awbery: The proposal in the Bill is to construct two bridges over the Avon and over Cumberland Basin. The bridges there now will become redundant and will be removed.
Bristol asks for this power. We sometimes place obligations and responsibilities upon local authorities to carry out work which they cannot implement until they come to the House and ask for power. It is strange to place an obligation and not give the authority the power to carry it out as it thinks necessary. Bristol Corporation asks for these powers to construct the bridges and the approaches. It asks for powers compulsorily to acquire the necessary land and to build the bridge over the railway. The owner of the land is the British Transport Commission. The Commission has not objected in principle to the Bill, though I understand that it wishes some variations of a minor character to be made which can be mutually agreed

upon. That can be done without a great deal of trouble. Compensation to be paid for the land that is to be acquired and for the extinction of the rights which are to be removed can be arranged by mutual agreement.

Mr. Robert Cooke: Before the hon. Gentleman leaves that point, will he deal with the question of the compensation and rehousing of my constituents who will be disturbed by the scheme?

Mr. Awbery: The local authority asks for powers to pay compensation for any disturbance which takes place. Provision is made to compensate those concerned if houses or roads are disturbed or land is taken from landowners.
I stress what my hon. Friend the Member for Bristol, South stated. These roads are absolutely essential in the interests of the City. The volume of traffic is increasing rapidly. I know that during the last twenty years we spent a very large sum on roads. Even so, the roads are not in a satisfactory condition to carry the increased volume of traffic. The Port of Bristol is very large, and much of the cargo to and from it is carried over our roadways. Therefore, it becomes necessary to bring our roads up to date for the purpose of carrying that traffic. The cargo was formerly carried on the railways. Now it has been transferred to the roads, which are not efficient to meet the demands of the road traffic. The roads are very often congested. Bottlenecks are created because of the volume of traffic. The local authority wants power to ease the congestion and remove the bottlenecks. It wants power to meet the changing circumstances by building better and larger roads. The amount of traffic which passes over the roads at present was never contemplated two decades ago, otherwise the roads would have been made much better.
As the hon. Member for Bristol, South said, Bristol is the gateway to the West Country from the rest of England. Traffic goes through Bristol to Cornwall and other parts of south-west England, particularly during the holiday period. This creates great traffic difficulties in Bristol. The Corporation has done a great deal to improve the roads. The two bridges proposed in the Bill are absolutely necessary to carry the traffic that will use the roads in future. We


have been told by the hon. Member for Bristol, South that they will cross navigable waters. Because of that, it is necessary that powers should be sought from this House for the bridges and subsidiary work. We have been told that the Minister of Transport will be consulted when the changes take place and alternative roads will be made available to the public when other roads are closed.
Reference has been made to flood relief. There have been floods and the local authority is asking for power to establish a fund to compensate the victims and to help people who may be affected by future floods. The Corporation hopes that as a result of the scheme which is almost completed floods will be unknown in future, but if they occur the Corporation wants power to compensate the sufferers.
As I have said, there are precedents for most of the Clauses in this Bill in other legislation. As far as I know, no Clause in this Bill raises matters which require the special attention of this House. That is why I hope that the Bill will not be opposed. By the Bill, the Corporation asks for exceptional powers which it does not possess. I am confident that the Bill will commend itself to the House and will be carried unopposed.

7.53 p.m.

Mr. Martin McLaren: I am in agreement with a good deal of what has been said about the Bill by my brethren from Bristol on both sides of the House. This is a general powers Bill and, therefore, it is bound to be of a rather miscellaneous character. The most important proposal in it deals with the new bridges and road improvements at the Cumberland Basin. In the centre of Bristol, we have a tide-less stretch of water known by the unusual name of the Floating Harbour. It is still used by foreign-going ships, as the Port of Bristol has been used for many centuries going back to the days of Sebastian Cabot. The Floating Harbour joins the tidal River Avon at the Cumberland Basin.
The Cumberland Basin was, for the most part, constructed 150 years ago. It is, therefore, not surprising if the general lay-out of the roads and bridges is not adequate to cope with the flow of

modern traffic. It is a place of more than local importance because, as the hon. Member for Bristol, Central (Mr. Awbery) said, Bristol is on the direct route from the Midlands to the southwestern peninsula. Dr. Barbara Moore had to pass through it the other day.
For anyone proceeding from the Midlands to the South-West, Bristol presents an obstacle for two reasons. First, one has to pass through a large city of almost 500,000 people. Secondly, one has to get across the River Avon. Most traffic goes by this route past the Cumberland Basin, and on Saturdays during the summer great traffic congestion results. There is a long queue which divides the whole City of Bristol into two. I often feel sorry on Saturday mornings for holiday-makers with young children having an irritating wait on what should be a happy day for them at the beginning of their annual holiday. The works proposed in the Bill will, I hope, alleviate this congestion and, accordingly, I welcome them. I am certain that they are badly needed.
I also welcome the proposal to extend the range of securities in which the Corporation may invest its superannuation funds. There are several precedents for this, notably Manchester, where the Corporation has done so well. We want everyone, including local authorities, to share in the blessings which investment in equities brings, although I concede that if the general law is about to be changed Clause 2 may need reconsideration.
I should like to refer to Clause 44, which concerns the flood relief fund. I support the principle here. We have low-lying areas in the city, near our two rivers. After heavy rainfall, the furniture, carpets and household effects of many people have been damaged through no fault of their own. Possibly the Corporation feels that if its drainage system, which it is in process of improving, had been better those people would not have suffered loss. It is proposed to introduce something like the principle of compensation for war damage which was familiar to us during the later years of the war, so that contributions may be made to the succour of people's neighbours who may be unfortunate and that they may be compensated for their loss.
The Bill has followed a very democratic process because it was submitted to a town's meeting convened under the provisions of the Local Government Act, 1933. Quite a lively evening took place. Certain provisions in the Bill were turned down. The whole of Part IV as to streets, buildings, and sanitation was turned down. Clause 57, which is a rather vague Clause dealing with powers for research into matters concerning social conditions, was also turned down. Those Clauses will not be proceeded with, and I feel that what remains may be approved.
We are a very ancient community, one of the principal cities in the Kingdom since early medieval days. Yet, we have always shown a modern vitality and outlook. We think that the provisions in the Bill are needed to keep us up to date in the conditions prevailing in the second half of the twentieth century. It is in that spirit that I submit that the Bill may be commended to the House.

8.0 p.m.

Mr. Ede: I wish to refer to a remark made by the hon. Member for Bristol, West (Mr. Robert Cooke) in the course of his speech on the Bill. I join with him and other hon. Members in congratulating my hon. Friend the Member for Bristol, South (Mr. Wilkins) on the way he introduced the Bill to the House. It was a model of the way in which such a Measure should be explained to us by a Member for one of the constituencies covered by the Bill. It left us in do doubt about exactly how much of the Bill now remains and the proposals of the Corporation in regard to it.
The hon. Member for Bristol, West said that he hoped the Parliamentary Secretary would say something about the suggestion which has been canvassed in many places that there should be a periodical introduction of a Local Government (Miscellaneous Powers) Bill to enable a good many of the things that are dealt with in these Bills to be part of general legislation and that they should not be steadily built up by first one corporation and then another bringing in the proposals and, in the end, things being assumed in some places because they have happened elsewhere when they are not, in fact, in operation in a city or borough which has not promoted a Bill.
In the last Session of Parliament I had the honour of serving on a Joint Select Committee which considered the question of the promotion of Private Bills. Although on a Joint Select Committee a Member of another place is elected as chairman, if he does not turn up to a meeting the senior Privy Councillor from this House takes the Chair. It was my misfortune on several occasions to be so landed with the duty of leading the examination of the witnesses.
Nearly every witness who came before us urged that the proposal which the hon. Member for Bristol, West has today mentioned should be put into force and that at intervals of, say, ten years a Bill should be brought in from the Ministry of Housing and Local Government bringing the general powers of local authorities up to date and making the application of what they propose effective over the whole country. There was also a feeling that there are one or two other Government Departments that similarly affect local government, one of which, curiously enough, was the Board of Trade with regard to weights and measures and in respect of which a similar process might be followed.
I hope that the Parliamentary Secretary will be able to say something tonight about the intention of his Ministry concerning this proposal. It would avoid a great deal of expense to local authorities in numbers of them promoting Clauses in Private Bills which should be unnecessary if his Department kept the local government law of the country up to date.

8.4 p.m.

The Parliamentary Secretary to the Ministry of Housing and Local Government (Sir Keith Joseph): Perhaps I may deal straight away with the point made by my hon. Friend the Member for Bristol, West (Mr. Robert Cooke) and then with the formidable support of the right hon. Member for South Shields (Mr. Ede) about the need for regular, general legislation. It is true that successive Committees investigating various aspects of Private Bill procedure have recommended that public legislation of this kind should be promoted at regular intervals by the Government.
My right hon. Friend fully agrees that this is a task which needs to be undertaken from time to time. It is well known


that his Department has progressed a long way in the preparation of two Bills which would generally extend to all local authorities a considerable number of well-precedented local Act provisions. I do not think that anyone will argue that simply because a Clause has appeared in a local Act or in several local Acts, it should be extended automatically to the whole country.
The essence of local legislation is that Parliament allows special powers or dispensations to meet the proved needs of a particular locality. The needs of one area are not necessarily shared by all other areas. Many local Act Clauses deal with matters of comparatively minor significance. Not all of them are urgent. Each Clause, therefore, needs to be looked at on its merits to see whether it should be made available throughout the whole country.
Having said that, however, there is little doubt that general Bills of this kind, when enacted, would remove some of the pressure for local legislation and reduce the length of local authorities' Private Bills. The introduction of these Bills depends largely upon the volume of other business coming before Parliament. On this point, I cannot go further than to repeat the Answer given by my right hon. Friend on 10th November last, in reply to the hon. Member for Stalybridge and Hyde (Mr. Blackburn). My right hon. Friend then said that the first of the two Bills which are being prepared—on public health matters—would be introduced as soon as Parliamentary time permitted.
I should very much like to support the Motion for Second Reading. As the hon. Member for Bristol, South (Mr. Wilkins) so clearly explained, the main purpose of the Bill is to enable Bristol Corporation to construct two bridges, one over part of the docks in Bristol known as the Cumberland Basin and one over the River Avon, as part of an extensive scheme for the improvement of highways in this area of the city.
I understand that the Corporation has taken the opportunity afforded by the need to promote a Bill for these purposes to seek, at the same time, a modest number of miscellaneous powers of the sort which regularly appear in local authorities' Bills and which the Corporation considers will be helpful in carrying

out more effectively its duties as a local authority. There are numerous precedents for many of these provisions in the local Acts of other local authorities.
We have heard comments on a number of the provisions from the chorus of Bristol Members who have spoken to the House tonight—the hon. Member for Bristol, South, my hon. Friend the Member for Bristol, West, the hon. Member for Bristol, Central (Mr. Awbery) and my hon. Friend the Member for Bristol, North-West (Mr. McLaren). Needless to say, they will not be surprised that my right hon. Friend does not consider that the Bill as drafted is perfect and he has taken up with the promoters a number of points on Clauses dealing with matters with which he is concerned. Other Ministers have done the same.
The hon. Member for Bristol, South referred particularly to Clause 33 of the Bill, which deals with oil-fired boilers. It differs in some respects from provisions dealing with the same subject which Parliament has already allowed in the Manchester Corporation Act, 1958, and the Portsmouth Corporation Act, 1959. I understand that my right hon. Friend the Secretary of State for the Home Department will be suggesting certain Amendments to the Corporation.
The hon. Member for Bristol, South told us that Clause 39 had been withdrawn. That is welcome news to me. He also talked about Clauses 38 and 40, which give power to the Corporation to invest a proportion of certain of its funds in equities. Clauses for this purpose appear in seventeen local authority Bills this Session. As the House knows, the recent Government White Paper on Powers of Investment of Trustees in Great Britain dealt with this subject and the Government intend to introduce legislation early next Session.
In these circumstances, the Government feel that they must oppose these provisions in these Bills. The Treasury has written to the local authorities concerned asking that they shall be withdrawn. I understand that my right hon. Friend the Chancellor of the Exchequer would, if necessary, urge that the Clauses be deleted when the Bills reach Committee, but in view of the very co-operative way in which the hon. Member for Bristol, South spoke, I am sure that in this case that will not be necessary.
The hon. Member also spoke of Clause 44, which empowers the Corporation to set up a flood relief fund, and several other hon. Members have spoken on the same Clause. My right hon. Friend would not for one moment question the general intention behind the proposal, but he sees certain difficulties about the Clause as drafted. For instance, it seems to overlap in some respects powers which are already available for dealing with the problems arising from flooding. He has accordingly asked the promoters to discuss the Clause with him.
In the view of my right hon. Friend, however, none of these matters would justify the House in any way refusing to give the Bill as a whole a Second Reading. They are all matters capable of being dealt with in the first instance by a Select Committee upstairs. Indeed, a Select Committee, with its facilities for hearing evidence from the Corporation and from any objectors to the Bill together with the views of the Ministers concerned, and of examining whatever papers, maps and plans might be required, can give the Bill a much more searching and satisfactory examination than it is possible for us to do on the Floor of the House.
In these circumstances, my right hon. Friend has asked me to express the hope that, in accordance with the normal practice, the Bill will be given a Second Reading so that its contents can be scrutinised in the usual way. No doubt the Select Committee charged with that task will take note of the views expressed in tonight's debate, and it will certainly be given any assistance it requires from the Ministers concerned with the various Clauses.

Question put and agreed to.

Bill read a Second time and committed.

Orders of the Day — CITY OF LONDON (GUILD CHURCHES) BILL (By Order)

Order for Second Reading read.

Motion made, and Question proposed, That the Bill be now read a Second time.

8.11 p.m.

Sir Hubert Ashton: I rise to speak in support of the Bill, but, first I should like to say a few words about my responsibilities in these matters. In the first place, I am described officially as "Second Church Estates Commissioner representing Church Commissioners". I am, therefore, directly concerned with all matters relating to the affairs of the Church Commissioners.
Secondly, I am a co-opted member of the Church Assembly, and when Measures come from that Assembly before the Ecclesiastical Committee and the House of Commons I would have prior knowledge of the Measures proposed. At the same time, the Lord Archbishop of Canterbury wishes me to make it clear that any action that I might take in respect of such Measures—not directly sponsored by the Church Commissioners—would be in my capacity as a member of the Church Assembly and not as Second Church Estates Commissioner Thirdly, as a member of the Church of England, like many others though not all in the House, I am ready to assist in other matters which concern the Church and which may arise from time to time.
The present Bill is not the direct concern of either the Church Commissioners or the Church Assembly, but falls into the third category as concerning directly the Diocese of London. The Bill is, therefore, promoted by the Bishop of London who, in consultation with the Archdeacon of London, has asked me to take charge of the Bill this evening I am glad to do my best, and I readily acknowledge the help that I have received from many sources and especially from the archdeacon who, as the House will know, gave evidence before the Select Committee on 29th April. 1952.
I apologise to the House for having gone into some detail, but I feel that there are some genuine misunderstandings about my position as Second Church Estates Commissioner. I have occupied


this office for the past two and a half years, and it is not always easy to define precisely the various matters which concern the Church Commissioners, the Church Assembly, and other official bodies of the Church of England. As, however, I am, inevitably, in fairly close touch with the affairs of all three, I hope that I may be given the opportunity by all hon. Members, and by others beyond the House, to help in any way that lies in my power and, indeed, at any time.
The Bill seeks to amend the City of London (Guild Churches) Act, 1952. As I am speaking in some detail on the Clauses, I hope that the House will forgive me if I stick fairly closely to my notes. The House may recall that the Bishop of London was empowered to designate and establish certain churches in the City of London as guild churches under the old Act. Broadly speaking, 16 churches—mostly rebuilt by Wren after the Fire of London—were scheduled as guild churches, leaving 24 churches as ordinary parish churches.
The proposals were considered in detail before a Select Committee on 29th April, 1952. The hon. Member for Islington, East (Mr. Fletcher) and the hon. Member for Barking (Mr. Driberg) were members of that Committee and played a notable part in its proceedings. I am glad to see both hon. Members in their places tonight. The reasons, broadly speaking, for the proposals were twofold. The first was to preserve these historic and splendid churches and the second to provide as vicars for them people with special qualifications.
Perhaps I can best explain the purpose of the Bill by reading a few lines from the Preamble to the 1952 Act, which said:
And whereas it is expedient that each such church should be in the charge of a clerk in holy orders who in addition to his fitness to minister to the non-resident population of the city should also possess special qualifications in scholarship preaching pastoral work or administration or other particular qualifications which render him suitable to offer specialised ministrations or services under lawful authority elsewhere.
I am sure that hon. Members will be glad to know that the scheme has proved successful and is working well. The number of churches designated as guild churches is 15, the one remaining being St. Mary Aldermanbury, which it is not

proposed to rebuild. Good clergy have been secured as vicars and 13 are now at work, although some of the churches have not yet been fully restored. Twelve of these vicars are fully qualified under the terms I read earlier, and some instances of the special work being done may be of interest to the House. I summarise this under various heads.
There is the youth work and voluntary religious education for adults. There is one vicar who travels throughout the country on the affairs of the Church of England Men's Society. Others pay special attention to the ministry of healing, marriage guidance, and the approach of the Church to all sections of the industrialised society. There is a clergy centre for training and advising the clergy of the dioceses of London, Southwark and Chelmsford. I am a humble people's warden in a country parish in the Diocese of Chelmsford and I know that there are other hon. Members present who are churchwardens.
Yet others of these clergy are concerned with relations with the churches on the Continent and with the Anglican communion in all parts of the world. In addition, the vicars, of course, are ministering to the daytime population of the City. The numbers who attend the services, naturally vary from church to church. Some have very good congregations indeed while others are less good. Not one, however, can be said to be failing.
I think, therefore, that it is perfectly right and fair to claim that this important and imaginative scheme for the City of London guild churches is working well and has, by and large, provided the results that had been anticipated. It has, however, become clear that the successful operation of the 1952 Act would be facilitated if some amendments—not being matters of fundamental principle—were to be made.
I now come to the Bill before the House. I think that the first Clause to comment on is Clause 3. This would give the Bishop of London power to designate as a guild church any of the City churches named in the First Schedule. No such cases are at present contemplated, but it is felt that provision should be made as and when the need arises. It will be seen that the Bishop cannot give such a certificate until a church has ceased to be a parish church.
This, in turn, depends upon proposals under the Reorganisation Areas Measures. These have to be laid before the House for 28 days and can be prayed against. Thus, the rights and duties of hon. Members are not impaired in any way. Clause 4 has the purpose of allowing machinery for filling vacancies to be commenced at an early date. This brings the position of guild churches into line with that of parish churches.
Clause 5 would allow the bishop, in appropriate cases, to ensure that a vacancy is not immediately filled by the patron. Such action is sometimes desirable when plans for reorganisation involving that particular church may be under consideration. Furthermore, it obviates the possibility that the right of appointment might lapse successively During any period of suspension, the church concerned would be served by a priest in charge.
In Clause 6 it is proposed that authority should be given for the transfer, but not, of course, for the sale, of a right of patronage of the living with the consent of the bishop. When the 1952 Act was being considered, the matter of patrons was gone into very carefully by the archdeacon and others concerned. The position as agreed then, after many negotiations, is set out in the First Schedule and involves a number of exchanges. It is now thought that powers to effect other exchanges should be granted if and when it is considered desirable to do this.
Coming to Clause 7, this proposes to amend Section 15 of the 1952 Act, to overcome a possible difficulty. It would provide that where there is for the time being no vicar, persons who wish to be entered on the electoral roll of a guild church may be so entered with the consent of the Archdeacon of London. That was a point which was raised in the Committee proceedings.
Clause 8 seeks to amend Section 32 of the Act, which allows a parish church or a guild church at the request of the civic authorities to be established once and for all as a ward church. The proposed Clause would, however, allow the bishop, in consultation with the civic authorities concerned, to change one ward church to another. In other words, this would give a little more flexibility in the

present proposals than is available under the Act. I should state that the Attorney-General has made a report to Parliament saying that he has no objection to the Bill. He adds that the Charity Commissioners have no comments to make thereon. Furthermore, the House will be aware that no petitions have been lodged against the Bill.
To sum up, it is clear that the proposals under the present Act are working well, and that after much thought and preliminary investigation they have provided an imaginative and up-to-date way of meeting the religious needs of the City in this modern world. At the same time, we are reserving a number of beautiful churches of great architectural value and historical background. Some Amendments, not of a major character, have proved by experience to be desirable.
I hope that after this explanation the House will not feel that I have kept it longer than I should have done and I commend the Bill sincerely to hon. Members. In order not to inflict myself upon hon. Members for a second time, may I say that the hon. Gentleman the Member for Islington, East (Mr. Fletcher), who has been with the Bill since its first stage, will be good enough to help to reply to the debate which may ensue.

8.22 p.m.

Mr. Tom Driberg: It is no bad thing that this House should occasionally devote a little time to the affairs of the Church of England. According to one's views of the matter, this is one of the handicaps or one of the privileges of having an Established Church. Moreover, the Bill before us, although it is in a sense consequential on the Act of 1952, extends further the novel experiment legalised by that Act and, therefore, affects the rights of Her Majesty's subjects, our constituents, and is of interest, or should be of interest, to every hon. Member of this House. In particular, if I may say so without impropriety—as I think I can, since it is not at all a party matter—it affects the rights and interest of the constituents of Mr. Speaker himself in the City of London.
I say at once that I thought, and think, the experiment of the guild churches an admirable one. It is, as the hon. Member for Chelmsford (Sir H. Ashton) said, an ingenious and


imaginative instrument for dealing with several related problems. It has enabled us to save some noble examples of the work of Wren and other great architects which otherwise might have been considered technically redundant, and in saving them it has provided an interesting assortment of specialist centres for the Church of England as a whole.
Some of these churches, including the one which I happen to know best, St. Mary Aldermanbury, have also been brought to new life and are furnishing a much-valued service to what the Bill calls the "non-resident population of the City", in the provision of lunch-hour services, concerts, lectures and so on. This was not, of course, the primary or necessary purpose of the 1952 Act. Parish churches in the City have been doing this kind of thing for many years. For instance, there is the remarkable work carried on at St. Stephen's, Walbrook, by the people called the Telephone Samaritans, who have actually, in the past few years, saved several hundred desperate people from suicide. That is very much a specialist vocation, and that is a parish church. Parish churches have been doing this kind of thing in various other ways, of course, long before the bombers destroyed so many of them, and even before our native vandals dared to list as redundant some of the masterpieces which have now, wisely, been rebuilt after bombing or preserved.
Since this scheme has now been in operation for some years, the debate provides a convenient occasion for a kind of interim report on its working, and I am glad that the hon. Gentleman said what he did about the scheme in general. I hope that when my hon. Friend the Member for Islington, East (Mr. Fletcher) winds up the debate he will tell us more about the individual churches involved, which all have their own special interests and attractions.
With the hon. Gentleman, I think that the experiment has been notably successful. Indeed, the only slight and, I think, unforeseen difficulty which has arisen has been financial. Guild churches, like other ancient buildings, are expensive to maintain. Their roofs leak, the stonework crumbles in the edacious metropolitan atmosphere. Each of them is in a parish—of which there is a parish

church. St. Mary Aldermanbury, for instance, is in the parish of the Church of St. Mary-le-Bow, part of which was re-opened only yesterday. Bow Church, the celebrated mother-church of all Cockneys, still has to raise a large sum of money for its restoration. It would be wrong for a guild church to solicit alms publicly in competition with its own parish church, or indeed, to expect the commuters who mainly use it to ignore, in its favour, their obligations to their own parish churches in the suburbs or the country. I rather hope that any Members who may have occasion to visit the City will make a brief pilgrimage to some of the wonderful buildings designated under the Act or under this Bill. They will be impressed by the liveliness of what is going on, and I venture to hope that they will drop in one or other of the alms-boxes the price of, say, a glass of sherry, either Spanish or South African.
Having said so much in support of what the hon. Member for Chelmsford has already said, I must add that we have a duty to scrutinise carefully, before agreeing to it, any Measure which does in any respect, as this Bill does, diminish or affect the rights of our constituents. Two sets of rights seem to me to be involved—the rights of the incumbents and the rights of the parishioners. The parson's freehold is an ancient English institution which has sometimes been used in the cause of freedom and sometimes for the purposes of tyranny. In recent years, various Measures—disciplinary measures from the Church Assembly and others—have tended to restrict it. In each case I think a strong argument for the restriction has been put up, but at least the case should be made every time and we should be clear what we are doing when we decide to diminish an ancient liberty. For, after all, each time a parish church is turned into a guild church and its incumbency becomes strictly temporary, the parson's freehold is diminished, whether we think of it individually or collectively. Moreover, it may be supposed that if this scheme is successful in the City of London, as I believe it has already proved itself to be, it may serve as a model for tackling comparable problems in other dioceses and other great cities.
Secondly, there are the rights of parishioners. At present, people have


the right to attend what are called the statutory services every Sunday, at their own parish church. If their parish church is turned into a guild church there will probably be no Sunday services in it at all, and, of course, it is one of the objects of the scheme that the vicars of these churches should be exempted from performing the statutory services because theirs is largely a weekday ministry. It is true that these residents of the City of London will still be in a parish, but they may have been used to attending the same church all their lives, and their new parish church may be further from where they live, or may be a church of a different tradition from that which they are accustomed to.
Emphasis is rightly laid on the weekday ministry—the ministry to the nonresident population, the commuters—but I must point out also that the resident population, very small as it has been for generations, is now once more increasing, with the Barbican scheme, the new Charterhouse flats and other projects. One defect of the Bill, if I read it aright, is perhaps that it does not place any limit on the number of churches that may be designated as guild churches. It is true, as the hon. Member for Chelmsford has told us, that there are still twenty-four parish churches left, and that is ample—perhaps too large a number—for the square mile of the City. But I hope we can have some assurance tonight from my hon. Friend the Member for Islington, East, that, however many more guild churches are designated, there will always be left sufficient parish churches, conveniently situated for the present and possible future resident population, and—this is very important, in view of the character of the Church of England—representative of the various traditions within that Church.
Now I want to put one or two specific questions to my hon. Friend who has, we understand, been asked to wind up this debate. I know that he has no direct responsibility, but if he cannot answer these points at once, no doubt he will be good enough to pass on to the promoters of the Bill the comments made in this debate.
My first question is a small one. In the Preamble to the Bill the word "corporation" with a small "c" is used. The passage reads:

… by virtue of that Act one such Guild Church is vested in the corporation …
It does not actually say what I suppose it means—the Corporation of the City of London. I do not know whether this is a drafting slip or whether there is some reason. If it is just a slip, no doubt it can be corrected in Committee, or when the Bill goes to another place.
Clause 3—Designation of additional Guild churches—I have already referred to in passing. Can my hon. Friend say whether there is any specific number in mind, since no specific number is given in the Bill itself? That ties up with the safeguards or the assurances I was asking for in relation to the permanent preservation of some parish churches.
Clause 5 is interesting and curious. It enables the bishop to keep the incumbency of a guild church vacant for as long as five years and, even after that, for
further periods not exceeding in the case of any one such further period five years.
That seems a rather odd provision. I gather that during the vacancy there would be some services provided in the church by a curate-in-charge, but it is surely not a very satisfactory position for the curate-in-charge himself, to go on for five years after five years. I do not know whether that is envisaged, or whether this is simply a safeguarding maximum time, but the main point I want to make is that under this Clause the Bishop is to have the power to suspend a presentation to a Guild church
with the consent in writing of the patron of the Guild Church (where he is not himself the patron thereof) and after consultation with the Guild Church Council of the church …
I should have thought that when making a new and rather daring modern experiment of this kind, we could afford to risk a little democracy, even in the Church of England. Why can we not have the consent of as well as consultation with the Guild Church Council? After all, the Council might strongly object to not having a parson to look after the church properly for five years or more. One has the impression that the church would inevitably be to some extent neglected and derelict. I do not know whether my hon. Friend can say anything about that point, but I hope that notice will be taken of it.
The hon. Member explained Clause 8, about ward churches, very fairly. This Clause refers back to the City of London


(Guild Churches) Act, 1952, and is consequential to it and modifies its provisions. I am rather sorry, all the same, that it was necessary to include it. I can see that there were, perhaps, practical difficulties in the way of designating such ward churches for ever and ever. On the other hand, I do not quite like the way that it is put here—the provision that the alderman and common council of the ward may at any time ask the Bishop to revoke the designation. I do not know that it is in any way disadvantageous to a clergyman for his church to cease to be a ward church—I imagine that it might make some difference financially, not to him personally but to the church funds—but there is something a little distasteful about the Clause. It gives an impression of civic tycoons throwing their weight about to try to intimidate or to discriminate against some parson whose preaching may be too stark and prophetic for their digestions.

Mr. Ede: That may be one of the things which will happen if we try to democratise the Church of England.

Mr. Driberg: Quite possibly but we should not be entirely discouraged from making such efforts.
One does not like to think of the alderman and common councillors, as it were, carrying their maces and chains, or whatever they carry, walking in a huff from St. Magnus the Martyr to St. Margaret Lothbury, or vice versa.

Sir H. Ashton: The final decision rests with the bishop.

Mr. Driberg: I hope that my hon. Friend can reassure me that the little word "may" in line 18 of page 5 will give the bishop power to resist firmly any such representations if he thinks that they are made for any unworthy, frivolous or even political reasons.
With those reservations, and with apologies for detaining the House for so long, I have great pleasure in supporting the Second Reading.

8.40 p.m.

Mr. Eric Fletcher: The hon. Member for Chelmsford (Sir H. Ashton) who opened the debate and moved the Second Reading in such comprehensive and felicitous language indicated that I had been asked by the promoter

of the Bill, the Bishop of London, who for this purpose is represented by the Archdeacon of London, to answer questions that were asked during the course of the debate. I will gladly do so to the best of my ability and I will proceed at once to deal with the specific points raised by my hon. Friend the Member for Barking (Mr. Driberg) before making a few more general observations that I should like to make about the merits, scope and purpose of the Bill, and the experiment which it is designed to extend.
The first point which my hon. Friend raised was one that also had occurred to me. When I looked at the Bill I noticed that in the Preamble there was a reference to "the corporation," without any indication whether it was the British Broadcasting Corporation, or any other corporation. I therefore looked at the parent Act of 1952 and I was surprised to find that there was no reference there to "the corporation," but that there was a reference to the "City Corporation," which is defined as the Corporation of the City of London. It is clear that this is a small drafting error, that the "City Corporation" is intended and that the necessary consequential Amendment will be made at a later stage to cure that small defect.
My hon. Friend then drew attention to what is perhaps the most important provision in the Bill, namely, Clause 3, which gives the bishop power to designate additional Guild churches. My hon. Friend asked two questions. First, whether there was any immediate intention of designating any more guild churches, and, if so, how many? I understand that there is no immediate intention of designating any additional guild churches. My hon. Friend then asked for an assurance that if further guild churches were designated the Bishop of London would see that there was always a sufficient number of parish churches left in London having regard not only to the present resident population of the City of London but also to the likelihood, indeed the probability, that in the near future the resident population of the City of London would be considerably increased.
I am happy to say that I am authorised by the Bishop of London not only to give that assurance, but also to give the assurance that care will be taken to


see that there is always a sufficient number of parish churches in the City representative of the different traditions of the Church of England.
My hon. Friend then drew attention to the provisions in Clause 5 which, at first sight, are a little surprising. These provisions enable the Bishop to suspend presentation to a guild church. I suppose that a layman might well ask why it should be necessary for the bishop to have the right to suspend, either in the case of a guild church or in the case of an ordinary parish church. It might be asked, if there is a vacancy, why it should not remain unfilled until the patron has found an appropriate incumbent. The answer is that if, either in the case of a parish church or a guild church, a living remains vacant for more than six months, the patron loses his right of patronage, and it lapses to the bishop. Therefore, it is in the interests of the patron that the bishop of a diocese should have power to declare a suspension for a certain time in order to avoid a vacancy extending for more than six months.
My hon. Friend inquired why we should provide that before exercising a right of suspension a bishop should have to obtain the written consent of the patron, while merely having to consult the Guild Church Council. He asked why the bishop should not also have to obtain the written consent of the Council. The answer is that the provisions concerning the guild churches bring the position into line with the law regarding an ordinary parish church. In such a case, before the bishop suspends he must obtain the written consent of the patron; and must consult the parochial church council. In those circumstances I do not think it unreasonable that precisely parallel provisions should be made in the case of guild churches.
The final point raised by my hon. Friend the Member for Barking concerned Clause 8, in respect of which he sought an assurance that "tycoons" of a particular ward in the City of London should not, for unworthy, frivolous or political purposes, abuse the right to ask that the designation of a ward church should be revoked. As the hon. Member for Chelmsford indicated, the final word on that matter rests with the bishop. I would regard that as a sufficient safeguard, and would deprecate

the likelihood of any unworthy use of this power to redesignate a ward church.
Having said that, as one who took a great interest in the Bill originally promoted in 1951, which became the Act of 1952, I should like to endorse what was said by the hon. Member for Chelmsford and my hon. Friend the Member for Barking as to the way in which what was at that time a very novel and perhaps some what daring experiment has worked out. The provisions of that Measure were very carefully scrutinised at the time in order to see that there was no unjustified departure from the long recognised traditions of the Church of England concerning the general parochial principle, the parson's freehold, or the rights of parishioners.
I recall that Sir John Crowder, who at that time was the Second Church Estates Commissioner, as the hon. Member for Chelmsford is today, indicated that there were four main objectives in the Act. It is worth pausing to see how far those objects have been achieved. He said that the first object was to preserve these City churches. They are mostly Wren buildings and are full of architectural distinction and historical significance. They have all been preserved. Most of them have been restored in a very worthy manner and others are in the process of being restored.
The second object was to make provision for weekday services for the nonresident population of the City of London. Any hon. Members who have had occasion to visit these churches on weekdays will be aware that a very real need is being fulfilled by the services provided on weekdays in these Guild churches.
Thirdly, it was desired to strengthen the links between the religious and civic life of the City of London. I am sure, Mr. Deputy-Speaker, that Mr. Speaker would be the first to recognise the considerable progress that has been made in this field since the establishment of guild churches.
The fourth object—and Sir John Crowder put this as the most important of the purposes of the Bill—was to provide posts and centres for clergy possessing special qualities in scholarship and so forth as referred to in the Preamble quoted by the hon. Member and which I need not quote again. Perhaps I may


quote, as indicative of the general objects of the scheme, the words used by Bishop Wand, then Bishop of London:
It is my wish and hope that the City may become a great ecclesiastical laboratory in which new methods of ministry, new physical experiments and new pastoral techniques may be tried out for the benefit of the whole church.
Anyone who is at all familiar with the way in which during the last eight years the Church of England, and in particular the Diocese of London, has made use of the facilities provided by this House in this Act will agree that this experiment has achieved a remarkable measure of success. I think it true to say that it has been even more successful than many of us hoped or envisaged eight years ago.
Since we do not often have an opportunity to refer in this House to the work of the Church of England, this is perhaps a convenient opportunity for me to add a word or two to what has been said by the hon. Member for Chelmsford and by my hon. Friend the Member for Barking with regard to the spiritual activities of the Church of England which have been developed during the last eight years because posts and centres have been provided for specially chosen clergymen to operate as vicars of Guild churches with specialist responsibilities for the work of the Church as a whole.
I would refer, first, to the work being done by Prebendary Bosworth of St. Margaret Pattens, a living in the gift of the Lord Chancellor. The Church has been fully restored and established as a clergy centre for post ordination training for the clergy of the Dioceses of London, Southwark and Chelmsford. Invaluable work is being done there to assist ordinands with improved technical training. It is so important today that the clergy, like other persons exercising professional skill, should be equipped with the necessary technical training to make full use of their special opportunities and responsibilities.
I also wish to refer to the work being done at St. Botolph's, Aldersgate, by the Rev. R. L. Roberts, who has been specially charged with the work of co-ordinating throughout the country the activities of the Church of England Men's Society. Due to the post provided by him in a guild church he has been able to rejuvenate that Society which has

had such a long and valuable history. I do not want to trespass on the indulgence of the House, but I should also mention how important is the work being done by the Rev. A. S. Hopkinson at St. Katherine Cree in an entirely non-parochial way in connection with the Industrial Christian Fellowship. I regard as most significant the fact that the Church of England is moving with the times and realising that it has work to do in a wide field outside purely parish work and that all kinds of new opportunities for the work of the Church in industry are being opened up and developed.
Finally, I must mention the invaluable contribution made over a number of years by Canon Waddams, who until a few months ago was Vicar of St. Michael's, Paternoster Royal. Apart from his work there, as some hon. Members will know he devoted himself for a long period to the important and specialised task of cementing and developing close relations and intimate contact between the Church of England and churches overseas, particularly in Europe and among the Orthodox Churches of the East.
I have myself noticed during visits abroad in the last year or two; for example, in Moscow, where I saw the Metropolitan Alexei, head of the Orthodox Church, and in Berlin, where Bishop Dibelius is bishop, the value attached by representatives of the Christian Churches in Europe—particularly in Eastern Europe, where, as the House knows, the Church has such a very difficult task—to their contacts with the Church of England. They have all been heartened by the knowledge of co-operation and friendship and indications of friendship received at the hands of the Church of England. Work of that kind can be done only by a specialist in this field who has a post such as a Guild church provides.
I hope the House will think that it was right eight years ago to pass this Act. I think the experiment has been very successful and that it is one to be encouraged, by giving this Bill, designed to extend the powers of the Bishop of London in this matter, a Second Reading.

Question put and agreed to.

Bill read a Second time and committed.

Orders of the Day — LOCAL AUTHORITY RATE BURDEN

Postponed Proceeding on Amendment to Question resumed;—

Question, That the proposed words be there added, put and agreed to.

Main Question, as amended, put and agreed to.

Resolved,
That this House welcomes the substantial assistance given by Her Majesty's Government to local authorities and the expansion of local services over the past eight years which this assistance has made possible, approves the principle of giving most help to authorities in greatest need embodied in the system of rate deficiency grants, and endorses the change from percentage grants to a system of general grants which resulted from the recent review of the general relationship between central and local government.

Orders of the Day — CRAMPTON STREET SCHOOL, SOUTHWARK

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Sharples.]

9.1 p.m.

Mr. Ray Gunter: It is, perhaps, not inappropriate that we should turn from a discussion on the Church to one on education. I desire tonight to raise a matter of grave concern to a number of my constituents; and I think that the Minister will agree that it is a justifiable concern as it relates to the education of part of the citizens of Southwark.
I think that the Minister will also agree that the best qualities of citizens are displayed when they reveal anxiety about the conditions under which their children are being educated. I can assure him that there is concern in my constituency because of his actions over the past twelve months or so. It is the conditions that exist at Crampton Primary School in the Metropolitan Borough of Southwark which give rise to this concern.
One of the unfortunate tendencies appears to be that less emphasis is placed on primary education than upon other forms of education in the size of classes, and the priority of buildings. It would appear sometimes that the primary schools are not having the treatment

that we should like them to have. I claim no expert knowledge in the field of education. I am frightened away from that field, because it appears to have so many educational experts who seem never to agree with one another. I must say, however, as an interested and ordinary sort of fellow, that I should have thought that if there were any stage at all when good conditions were an absolute necessity it was in the first formative years of a child's education.
The first five or six years of a child's education are of dramatic importance in the sense of moulding the questing mind of the child. Drabness, dreariness and inadequate facilities can make the child lose for the whole of a lifetime any idea of the true purpose and true joy of an educated mind. I do not doubt for one moment that the Minister is entirely in agreement with me on this desirable end. He has the unenviable and, I admit, difficult task of determining priorities within the physical resources available to him. I am sure, also, that he would not claim infallibility in the determination of priorities, but I would very respectfully say that I think that in this case a mistake has been made.
It is the belief of my constituents and local authorities that a mistake has been made. Crampton Primary School has 274 children on the register, in seven classes, almost entirely housed in hutments of a temporary character. One corrugated iron hutment was built for temporary purposes, I understand, in 1882; one was built in 1943, one in 1949, one in 1952 and one in 1954. They are there because of bombing which took place twenty years ago. Three of these hutments have two classes in them, and the classes are divided from each other by a thin partition. The entrance class is taught in the building which, as I have said, was built in 1882. It is a building which the inspector himself has described as follows:
The hall, which, it will be remembered, is the oldest edifice, is small, dingy, poorly ventilated and cluttered. A wash-up takes up space on one side, stock cupboards have to be ranged at intervals round the walls, bulky apparatus for physical education is stacked there, and a small movable platform, from which the headmistress takes assembly, has also to be included, as well as a stand for the children's coats when it is wet.


Admissions to the school number about 40 children a year. The toilets for these children are part of the original premises, built in 1882, and to proceed from the hutment to the toilets the children must cross open space. In other words, these children must be taken out into the open whatever the weather conditions.
The corporate life of the school, which is so necessary in these days, is desperately hampered because there is no adequate assembly hall. I draw the Minister's attention to a very serious statement made by his own inspector on this matter. He reported
The atmosphere in this school is pleasant and secure, but, throughout, the children tend to show some evidence of immaturity for their age. A considerable variety of causes is responsible for this.
He went on to say:
One or two may be unalterable and some relate to the recent history of the school. In actual material structure, also, the school does not lend itself easily to the development of a corporate sense.
We all agree that in these days a corporate sense is essential in a school if the children are to benefit from the facilities of education.
I turn for a moment to the heating arrangements. The heating is done mostly by gas heaters at ceiling level. Thus, the heads are hot, and the feet are cold on concrete floors. I again draw attention to the inspector's report. He reported that
Two rather more minor disadvantages are that in wet weather the roofs of three of the most elderly huts are liable to leak and that the heating in two of the prefabricated huts (the oldest) is unsatisfactory; the overhead gas heaters beat uncomfortably upon the head of an adult and at the same time the heat fails to reach ground level.
It is the considered opinion of the inspector that
children suffer from cold feet and any work on the concrete floors is impossible in very cold weather.
I turn to another matter—feeding. Only about 60 children can be given meals at the school because of the lack of facilities. Restriction of the numbers feeding there must take place because of the impossibility of dealing properly with any more. The inspector draws attention to this when he says:
About 68 children stay for dinner—a relatively small number which is perhaps accounted for by the limited accommodation.

The meal is a transported one. Arrangements for serving and washing up are very primitive and, perhaps in consequence, the service is rather slow, especially between courses.
We are considering, therefore, not only the opinion of the school managers or of the local authority in my constituency, for here we have the views of the responsible people, sent around with the specific task of inspecting these schools, who can only deplore the conditions in which these children are educated. No tribute is high enough for the staff, who have fought a relentless battle against these conditions. Nevertheless, the turnover of staff is rather high because of the physical conditions. I must pay an additional word of tribute. The caretaker should have a gold watch as big as a frying pan for the work which he so magnificently performs in looking after the premises and keeping them in the state he does.
I want to draw the attention of the Parliamentary Secretary to another factor, apart from the physical conditions prevailing at the school. Very near to the school the Alberta Housing Estate is in process of erection. I understand that it will be near completion in about three years from now. It will then contain 350 dwellings. The significance is that it is essentially a family estate. It is being let to younger married couples with their smaller families. What proposals has the Minister to deal with the growing number of young children, because he cannot conceive the idea that they must be jammed into these hutments.
It was for these reasons that the London County Council wanted to build a new school where the present assembly of hutments exists. The council included it in its 1960–63 programme. I understand that it was struck out by the Minister and is not now in the revised 1960–62 programme. Therefore, it is conceivable that we shall be arguing about these conditions for another three or four years.
I said at the outset of my remarks that I did not envy the Minister his difficult task of determining priorities, but with very great sincerity I appeal to him to have another look at this subject and not allow these conditions to prevail for another four or five years. Will he at least give us hope that he will bear in mind the urgency of the problem and


perhaps come and look at the conditions? Will he give to the London County Council the earliest opportunity of proceeding with a modern school on this site? I am confident that he will appreciate the feelings of discontent in the hearts of this section of my constituents who have children, now being educated in conditions which are not worthy of a prosperous and modern society.

9.13 p.m.

The Parliamentary Secretary to the Ministry of Education (Mr. Kenneth Thompson): The hon. Member for Southwark (Mr. Gunter) has been kind enough almost to make my speech for me, and I am grateful to him both for doing that and for the restrained and purposeful way in which he put the case, which I know means much to him and to the parents, teachers and children at Crampton Street Primary School.
I was rather sorry that the hon. Gentleman thought it a good thing to say that, for whatever reason, primary education might be being thrust into the background at present. It can do no harm to relate the priorities under which the Ministry is compelled to work at present and which have been pursued, and indeed refined, as the years since the end of the war have passed.
Our first task was to provide accommodation for the children who remained in school as a result of raising the leaving age from 14 to 15. Then we had to set our house in order and put roofs over the heads of the growing number of children produced by what we now call loosely but graphically, the bulge. The House is aware, but no harm can come from repeating the fact, that there are now over 2 million more children in the schools of this country as a whole than there were at the end of the war. The first job of the Department was to provide those children with somewhere where they could be taught.
Apart from areas where there is a rapidly growing population and where populations move and change constantly, that part of the problem is now coming to a solution. Now we have to put ourselves in a position to provide accommodation for the children as they move from primary school to secondary school—the bulge. It may seem, but I

hope not improperly, to the hon. Member that primary education, for the time being at any rate, is getting less of an immediate and overriding priority than it had before or than perhaps the hon. Member thinks it should have at present. I think that a reasonably fair part of the not unlimited resources has gone into that necessary part of the work.
I agree with every word that the hon. Member said about the significance and importance of the early years of a child's school life. I like to think that the work done at school will bear the kind of fruits that we should like to see as the children progress through their school life into a more complicated way of life of responsibility, business and marriage.
I now turn to the Crampton Primary School. We know that the school is not housed as happily as a school of this kind in this sort of area should be housed. I think that we would all share the view that a school in an area which is not itself a very good and elegant area should set an example and ought to be a good school. Here we are faced with a school which is not good. The bombing during the war destroyed the buildings, with the exception of the caretaker's house, the lavatories, and this old corrugated hut—not a very wise choice of targets, I should have thought. That is what was left of the school. The London County Council, in its efforts to provide accommodation for the children, set about trying to put something up. I should have thought that the London County Council was entitled to great praise for its efforts. The hon. Gentleman listed them. I have them before me. I think that it is a commendable record. These huts were put up during 1943, 1949, 1952 and 1954. The old corrugated temporary building is older than any of us.
I am bound to say that there are difficulties in teaching there. I had the advantage of seeing the report from which the hon. Member quoted at some length. At the end, I had the feeling that, in spite of bad buildings and dispersal, and in spite of perhaps a sense of being overlooked or neglected, this was a fairly good school. I think that the hon. Member was probably right to say that this fact owes much to the staff


and caretaker. I can join with the hon. Member in paying tribute to those who work successfully under conditions that are not good.
This rebuilding project has been put forward by the London County Council for inclusion in one or other of the last two programmes—the 1960–61 or the 1961–62 building programme. The hon. Gentleman was quite right to sympathise with the Minister and the Ministry who have to sort out these priorities. I hope that he will share some of his sympathy with the London County Council, which has to take part in this very difficult exercise. This is a problem with which the Ministry lives day by day—the problem of how to make sure that such resources as are available, which are not unlimited, are canalised into directions where the need is greatest and where the use of the resources will do most good.
I cannot say when it will be possible to promise that this school will be rebuilt, because the assessment of priorities and urgencies must always be undertaken afresh with each year's building programme. I am sure the hon. Member will agree that that is the right way to go about it. We have recently asked local education authorities to let us have their projected building programmes for the year 1962–63. I do not know whether the Crampton Street primary school will appear in the L.C.C. list. Even if it appears there, I still do not know whether it will emerge as one of the priorities getting itself a place in that year. We are, however, in the middle of a five-year building programme, and we should not lose heart if we find one

day that we have failed to get all of the five years' programmes into any one year. There is a long way yet to go before we get to the end of our five-year programme.
I should like to ask all those who have children at school or who work there as teachers or have an interest as managers to believe that we want to replace the school with a decent school as soon as we can. When we see our way clear to do so nothing will give my right hon. Friend greater pleasure than to be able to have a new primary school serving the children who are now served by this unsatisfactory school in Crampton Street.

Mr. Gunter: What is to happen to the children from the 350 new dwellings?

Mr. Thompson: I did not want to get diverted into that, because it is part of a wider problem. It may well be that the Friars county primary school now being built in Southwark will either serve those 350 houses or will siphon off from the Crampton Street primary school some of the children, whose places could be taken by the children from the 350 houses. I really do not know. I would need notice of the question and a good look at a rather detailed map before I could give a precise answer. I was trying to avoid being contentious and was refraining from reminding the hon. Member that Southwark has a county primary school in the existing programme, but it is all part of the whole plan of trying to do a complicated job as best we can.

Question put and agreed to.

Adjourned accordingly at twenty-two minutes past Nine o'clock.